[Senate Hearing 112-590, Part 7]
[From the U.S. Government Publishing Office]



                                                 S. Hrg. 112-590, Pt. 7
 
      DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS 
     FOR FISCAL YEAR 2013 AND THE FUTURE YEARS DEFENSE PROGRAM

=======================================================================



                                HEARINGS

                               before the

                      COMMITTEE ON ARMED SERVICES
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                                   ON

                                S. 3254

     TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2013 FOR MILITARY 
ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND 
   FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE 
   MILITARY PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR, AND FOR OTHER 
                                PURPOSES

                               ----------                              

                                 PART 7

                            STRATEGIC FORCES

                               ----------                              

                    MARCH 14, 21, 28; APRIL 25, 2012


         Printed for the use of the Committee on Armed Services




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                                                  S. Hrg. 112-590 Pt. 7

DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 
               2013 AND THE FUTURE YEARS DEFENSE PROGRAM

=======================================================================

                                HEARINGS

                               before the

                      COMMITTEE ON ARMED SERVICES
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                                   ON

                                S. 3254

     TO AUTHORIZE APPROPRIATIONS FOR FISCAL YEAR 2013 FOR MILITARY 
ACTIVITIES OF THE DEPARTMENT OF DEFENSE, FOR MILITARY CONSTRUCTION, AND 
   FOR DEFENSE ACTIVITIES OF THE DEPARTMENT OF ENERGY, TO PRESCRIBE 
   MILITARY PERSONNEL STRENGTHS FOR SUCH FISCAL YEAR, AND FOR OTHER 
                                PURPOSES

                               __________

                                 PART 7

                            STRATEGIC FORCES

                               __________

                    MARCH 14, 21, 28; APRIL 25, 2012

                               __________

         Printed for the use of the Committee on Armed Services


        Available via the World Wide Web: http://www.fdsys.gov/





                      COMMITTEE ON ARMED SERVICES

                     CARL LEVIN, Michigan, Chairman

JOSEPH I. LIEBERMAN, Connecticut     JOHN McCAIN, Arizona
JACK REED, Rhode Island              JAMES M. INHOFE, Oklahoma
DANIEL K. AKAKA, Hawaii              JEFF SESSIONS, Alabama
E. BENJAMIN NELSON, Nebraska         SAXBY CHAMBLISS, Georgia
JIM WEBB, Virginia                   ROGER F. WICKER, Mississippi
CLAIRE McCASKILL, Missouri           SCOTT P. BROWN, Massachusetts
MARK UDALL, Colorado                 ROB PORTMAN, Ohio
KAY R. HAGAN, North Carolina         KELLY AYOTTE, New Hampshire
MARK BEGICH, Alaska                  SUSAN M. COLLINS, Maine
JOE MANCHIN III, West Virginia       LINDSEY GRAHAM, South Carolina
JEANNE SHAHEEN, New Hampshire        JOHN CORNYN, Texas
KIRSTEN E. GILLIBRAND, New York      DAVID VITTER, Louisiana
RICHARD BLUMENTHAL, Connecticut

                   Richard D. DeBobes, Staff Director

                 Ann E. Sauer, Minority Staff Director

                                 ______

                    Subcommittee on Strategic Forces

                 E. BENJAMIN NELSON, Nebraska, Chairman

JOSEPH I. LIEBERMAN, Connecticut     JEFF SESSIONS, Alabama
JACK REED, Rhode Island              JAMES M. INHOFE, Oklahoma
MARK UDALL, Colorado                 ROGER F. WICKER, Mississippi
MARK BEGICH, Alaska                  ROB PORTMAN, Ohio
JEANNE SHAHEEN, New Hampshire        JOHN CORNYN, Texas
KIRSTEN E. GILLIBRAND, New York      DAVID VITTER, Louisiana

                                  (ii)



                            C O N T E N T S

                              ----------                              

                    CHRONOLOGICAL LIST OF WITNESSES
      Strategic Forces Programs of the National Nuclear Security 
 Administration and the Department of Energy's Office of Environmental 
  Management in Review of the Department of Energy Budget Request for 
                            Fiscal Year 2013
                             march 14, 2012

                                                                   Page

D'Agostino, Hon. Thomas P., Ph.D., Administrator, National 
  Nuclear Security Administration, and Under Secretary for 
  Nuclear Security, Department of Energy.........................     7
Donald, ADM Kirkland H., USN, Deputy Administrator for Naval 
  Reactors and Director, Naval Nuclear Propulsion, National 
  Nuclear Security Administration, Department of Energy..........    49
Cook, Hon. Donald L., Deputy Administrator for Defense Programs, 
  National Nuclear Security Administration, Department of Energy.    53
Huizenga, David G., Senior Advisor for Environmental Management, 
  Office of Environmental Management, Department of Energy.......    55

                        Military Space Programs
                             march 21, 2012

Creedon, Hon. Madelyn R., Assistant Secretary of Defense for 
  Global Strategic Affairs.......................................    95
Shelton, Gen. William L., USAF, Commander, Air Force Space 
  Command........................................................   100
Formica, LTG Richard P., USA, Commander, U.S. Army Space and 
  Missile Defense Command/Army Forces Strategic Command..........   110
Winokur, Robert S., Director of Oceanography, Space, and Maritime 
  Domain Awareness, Department of the Navy.......................   117
Zangardi, Dr. John A., Deputy Assistant Secretary of the Navy for 
  Command, Control, Communications, Computers, Intelligence, 
  Information Operations, and Space..............................   123
Chaplain, Cristina T. Director, Acquisition and Sourcing 
  Management, Government Accountability Office...................   123

           Department of Defense Nuclear Forces and Policies
                             march 28, 2012

Creedon, Hon. Madelyn R., Assistant Secretary of Defense for 
  Global Strategic Affairs.......................................   178
Weber, Hon. Andrew C., Assistant Secretary of Defense for 
  Nuclear, Chemical, and Biological Defense Programs.............   187
Benedict, RADM Terry J., USN, Director, Strategic Systems 
  Programs, U.S. Navy............................................   190

                                 (iii)

Kowalski, Lt. Gen. James M., USAF, Commander, Air Force Global 
  Strike Command, U.S. Air Force.................................   198
Chambers, Maj. Gen. William A., USAF, Assistant Chief of Staff 
  for Strategic Deterrence and Nuclear Integration, U.S. Air 
  Force..........................................................   202

            Ballistic Missile Defense Policies and Programs
                             april 25, 2012

Roberts, Bradley H., Ph.D., Deputy Assistant Secretary of Defense 
  for Nuclear and Missile Defense Policy.........................   239
O'Reilly, LTG Patrick J., USA, Director, Missile Defense Agency..   246
Formica, LTG Richard P., USA, Commander, U.S. Army Space and 
  Missile Defense Command/Army Forces Strategic Command, and 
  Commander, Joint Functional Component Command for Integrated 
  Missile Defense................................................   253
Gilmore, Hon. J. Michael Ph.D., Director, Operational Test and 
  Evaluation, Department of Defense..............................   259
Chaplain, Cristina T., Director, Acquisition and Sourcing 
  Management, Government Accountability Office...................   263


DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 
               2013 AND THE FUTURE YEARS DEFENSE PROGRAM

                              ----------                              


                       WEDNESDAY, MARCH 14, 2012

                               U.S. Senate,
                  Subcommittee on Strategic Forces,
                               Committee on Armed Services,
                                                    Washington, DC.

      STRATEGIC FORCES PROGRAMS OF THE NATIONAL NUCLEAR SECURITY 
 ADMINISTRATION AND THE DEPARTMENT OF ENERGY'S OFFICE OF ENVIRONMENTAL 
  MANAGEMENT IN REVIEW OF THE DEPARTMENT OF ENERGY BUDGET REQUEST FOR 
                            FISCAL YEAR 2013

    The subcommittee met, pursuant to notice, at 2:36 p.m. in 
room SR-222, Russell Senate Office Building, Senator E. 
Benjamin Nelson (chairman of the subcommittee) presiding.
    Committee members present: Senators Nelson and Sessions.
    Majority staff member present: Jonathan S. Epstein, 
counsel.
    Minority staff member present: Daniel A. Lerner, 
professional staff member.
    Staff assistants present: Hannah I. Lloyd and Brian F. 
Sebold.
    Committee members' assistants present: Ryan Ehly, assistant 
to Senator Nelson; Chad Kreikemeier and Lenwood Landrum, 
assistants to Senator Sessions; and Charles Brittingham, 
assistant to Senator Vitter.

   OPENING STATEMENT OF SENATOR E. BENJAMIN NELSON, CHAIRMAN

    Senator Nelson. Let me call today's hearing to order. 
Today's hearing will be on the fiscal year 2013 budget 
submission for the defense-related programs at the Department 
of Energy (DOE). We'll hear testimony from the Administrator of 
the National Nuclear Security Administration (NNSA), the 
Honorable Thomas P. D'Agostino, who maintains the safety, 
reliability, and military utility of our Nation's nuclear 
weapons. We'll also hear testimony from the Office of 
Environmental Management (EM), whose mission is to clean up 
former Cold War nuclear weapons production sites.
    I want to thank our witnesses today for taking the time out 
of their schedules to testify on these programs, and I of 
course want to thank my good friend and ranking member of this 
committee. We've worked so well together over the years, having 
traveled on congressional delegations and other opportunities 
to be together. I want to thank Senator Sessions for all of his 
help and support over the years.
    In August, we passed the Budget Control Act (BCA), which 
set a 10-year ceiling on the defense and non-defense portions 
of our discretionary budget. For the Department of Defense 
(DOD) relative to the 2012 baseline, that translates to a $259 
billion reduction in the 5-year budget window from 2013 to 
2017, with a growth of about 1 percent annually.
    DOD made hard decisions to meet the reductions under the 
act, and likewise I expect similar hard decisions have been 
made by NNSA and the Office of EM. This hearing will examine 
those decisions.
    This hearing will also examine recent findings from the 
National Academies from a study we legislated in the fiscal 
year 2010 defense authorization bill on the role of NNSA in 
managing its laboratories. NNSA has proposed a top-line budget 
of $11.5 billion, a 4.9 percent increase over the enacted 
fiscal year 2012 levels. Within that budget, the amount to 
maintain and modernize our nuclear weapons increased by 5 
percent to $7.6 billion, nonproliferation increased by 7.1 
percent to $2.5 billion, and the amount for naval reactors 
increased by .8 capability to $1.1 billion.
    So compared to DOD, I would say NNSA came out a winner. In 
terms of the commitment made as a part of the New Strategic 
Arms Reduction Treaty (START) debate, the budget does fall 
short, about 4 percent short, of the $7.9 billion as found in 
what we refer to as the 1251 report, which is the 10-year 
nuclear modernization plan required under section 1251 of the 
2010 National Defense Authorization Act (NDAA).
    Realistically, given that the 1251 report was submitted to 
Congress in November 2010, 9 months before the BCA became law, 
falling 4 percent short of the $7.9 billion target is 
reasonable, given the fiscal reality facing us today.
    The same can be said for the budget of the Office of EM. 
Its fiscal year 2013 budget request is $5.65 billion, about 2 
percent below last year's enacted level. Now, this office has 
some of the most challenging and pressing problems in DOE in 
cleaning up millions of gallons of highly radioactive wastes 
left behind from 50 years of nuclear weapons production.
    While the top-line numbers of the NNSA look good compared 
to DOD, there are, however, questionable decisions in its 
formulation. Let me go over my five top concerns. First and 
foremost is the decision to defer for 5 years the construction 
of the replacement for the Chemistry and Metallurgy Research 
Replacement (CMRR) facility, building in Los Alamos, first 
built in 1952 with a mandate for closing it by 2019 for safety 
reasons. This new CMRR facility along with the Uranium 
Processing Facility (UPF) at the Oak Ridge Y12 plant, are the 
two cornerstones for a modernized nuclear weapons 
infrastructure.
    The administration agreed to build these facilities as part 
of the New START debate. The new CMRR facility was to 
facilitate an ability to manufacture, if needed, 50 to 80 
plutonium pits per year, which as recently as 2 weeks ago 
General Kehler of U.S. Strategic Command (STRATCOM) stated was 
still a DOD requirement. Without the new CMRR facility, Dr. 
McMillan, the Director of Los Alamos, has flatly stated an 
inability to meet that requirement.
    In its place, NNSA is now looking at spreading out its 
plutonium operations to multiple NNSA facilities across the 
United States, from Lawrence Livermore in California to the 
Savannah River Site in South Carolina, just to be able to 
manufacture 20 to 30 pits per year. I hope Dr. D'Agostino and 
Don Cook can help me understand how they came to this decision 
and whether they believe the proposed alternative strategy is a 
sound and final decision.
    In this current fiscal environment, deferring anything for 
any length of time implies a cancellation to Congress. It just 
implies that. So I am pleased that NNSA is proceeding with 
replacing the UPF, another Manhattan era facility used for 
making the secondaries in our nuclear weapons, but as I 
understand it they're increasing its budget by $150 million. It 
raises the question: Why couldn't NNSA use this increase to at 
least begin construction of the new CMRR facility, perhaps at a 
slower pace, but to get the process started? Multi-year 
budgeting is very difficult, but it does occur within this 
structure.
    Second, I understand that the Nuclear Weapons Council (NWC) 
has given approval to begin the engineering for overhauling the 
B61 gravity bomb and I'm eager to hear what NNSA believes are 
the major costs and hurdles they face going forward in 
combining several variants of this weapon system into one, 
which ultimately, as we know, can save costs in its 
maintenance.
    Third, in order to find funds for the B61 program, NNSA has 
slowed down its production of reworked W76 warheads that the 
Navy uses in its Ohio-class submarines. In a later hearing, I 
hope to explore the implications of this slowdown with the 
Navy, but I'm concerned whether it's disrupting the fleet's 
overhaul schedule of when the boats come to home port for 
installing the rebuilt warheads and whether the Navy will 
suffer increased costs and have a risk related to that as a 
result.
    Fourth, DOD tells us they're delaying the schedule of the 
replacement for the Ohio-class submarines by 2 years, with 
first construction starting in 2021. This slip has caused a 
decrease in the research funds for its reactor by about $31 
million in fiscal year 2013. So I would like to know from 
Admiral Donald what is the impact of this decrease and what is 
your concern on this trend, particularly in fiscal year 2014 
and beyond?
    Fifth, there are concerns about NNSA governance. The 
National Academy of Sciences released report that we referred 
to, mandated in the 2010 NDAA, which commented that ``the 
relationship between NNSA and its national security 
laboratories is becoming dysfunctional.'' NNSA was created in 
the 1999 NDAA to give the weapons program independence, but the 
original intent of a stand-alone agency only reporting to the 
Secretary of Energy now seems lost.
    So when you look at the DOE organization chart, it still 
resides within the DOE bureaucracy. I'd like to know from Dr. 
D'Agostino what his response to the report's findings might be 
and what we in Congress can do to help carry out your mission.
    Finally, not to let you off the hook--and I'm going to 
butcher the word, the name; ``Hue-ZIN-gah,'' am I close?
    Mr. Huizenga. Yes.
    Senator Nelson. Huizenga. I don't want to let you off the 
hook entirely here. The Hanford waste treatment plant had the 
honor in January of making the front page of USA Today, as we 
all know, with large cost overruns, up to a billion dollars 
over the life of the plant, which is currently budgeted at $12 
billion and will begin operations in 2019.
    The original cost was $5.7 billion, with operations to 
begin in 2011. This is the largest and most technically complex 
project in DOE, with a mission to retrieve and solidify into 
glass logs 53 million gallons of highly radioactive sludge and 
liquid waste residing in 177 underground tanks at the Hanford 
site. 144 of the tanks are just one layer of carbon steel, 
instead of the double-shell construction used today to contain 
leakage.
    These tanks reside 7 to 12 miles from the Columbia River, 
which runs the length of the border between Oregon and 
Washington, where about 1.5 million people reside. So I'd like 
to know what action you have undertaken since August 2011, that 
review to reduce technical risk in the treatment facility and 
what efforts are there to resolve workers' concerns about 
safety and engineering design.
    With that long opening, let me now turn to my good friend, 
Senator Sessions, for any opening remarks that he might like to 
make.

               STATEMENT OF SENATOR JEFF SESSIONS

    Senator Sessions. Thank you, Chairman Nelson. It's been 
such a great pleasure to work with you on this subcommittee. 
Your knowledge and experience and judgment on these matters are 
invaluable to us, and I really value your judgment.
    I share some of the concerns that you've raised. We do have 
responsibility to our constituents to challenge the proposals 
that are before us to make sure every dollar that we spend is 
wisely spent. I've been somewhat uneasy for a number of years 
about some of the nuclear programs that NNSA has been involved 
in, and we'll continue to raise those as time goes by.
    Over the past few years, this subcommittee has heard 
testimony from countless experts who have unanimously 
recognized the critical need for modernizing our nuclear 
weapons complex. We have to do that. Unfortunately and counter 
to the bipartisan progress that we have made thus far, NNSA's 
fiscal year 2013 budget undermines that progress and the 
agreements that were reached, it seems, and jeopardizes the 
future viability of the nuclear weapons complex.
    This budget incorrectly suggests that the recapitalization 
of our nuclear weapons complex is unaffordable and suggests 
that we as a Nation cannot afford to modernize in a way that 
assures confidence, confidence in competent stewardship.
    I disagree with that. Despite our need for fiscal 
austerity--and there is a need--shortchanging nuclear 
modernization at a time when we face threats and uncertainty 
ahead, and they even grow, is simply not acceptable. We must 
continue to pursue the robust modernization the experts, such 
as the bipartisan Strategic Posture Commission, have testified 
has been critical to the recapitalization, recapitalizing a 
vanishing intellectual base and crumbling infrastructure.
    It has been only 1 year since the ratification of New START 
and the President has already failed to honor the commitments 
in this budget that he made at that time. I don't know exactly 
what the amount of money we need, but the amount that was 
committed is not provided for in this budget. Senator Kyl, who 
worked so hard on that, is deeply disappointed.
    I'm prepared to hear testimony that some of the things 
could be done for less money, but I'm not prepared to concede 
that we should in any way reduce our plans to modernize our 
nuclear weapons.
    So when first proposed in 2010, both Congress and the 
administration agreed that the 10-year nuclear modernization 
plan was a matter of national importance and, even with our 
dismal fiscal outlook and overwhelming consensus, concluded 
that fully funding a comprehensive modernization plan was 
essential for the future. Vice President Biden wrote in the 
Wall Street Journal in January 2010: ``Over the next 5 years, 
we need to boost funding for these important activities by more 
than $5 billion. Even in a time of tough budget decisions, 
these are investments we must make for our security.''
    This plan and these budget decisions were the result of a 
lot of study and some bipartisan agreements. They had the full 
support of DOD, which even in the face of significant cuts to 
DOD was to contribute over $7 billion to NNSA.
    As the ranking member of the Senate Budget Committee, I'm 
acutely aware of the fiscal challenges that face us. I 
appreciate that NNSA is looking for ways to do more with less. 
I certainly celebrate that. However, the decision to ignore 
critical DOD requirements and to defer the facility at Los 
Alamos construction and repair, while also increasing funding 
for the multi-billion dollar facility at Y12, is something I'm 
not comfortable with at this point.
    It perpetuates the status quo mentality that everything 
nuclear has to be exceedingly expensive. Some things do, some 
things don't. I believe there are smarter and less onerous ways 
to affordably recapitalize the nuclear weapons complex and I'm 
disappointed not to see any serious proposals for addressing 
the out-of-control risk aversion that has ballooned costs.
    The NNSA budget favors short-term cost avoidance over 
strategy and is based on a number of assumptions that are 
contrary to the national security of the United States and its 
allies. The budget neglects a standing DOD requirement for a 
capability to manufacture between 50 and 80 pits per year and 
recklessly presumes that future life extension program (LEP) 
plans will be allowed to cannibalize the pits of weapons 
currently held in strategic reserve. While the reuse of pits 
may be an attractive option, the studies to support its long-
term feasibility have not taken place. Furthermore and most 
telling, these decisions are not supported by STRATCOM.
    The budget underscores a growing disconnect between DOD and 
NNSA. A number of the fiscal year 2013 budget cuts have 
prompted our military leadership to question and raise concerns 
about NNSA's ability to meet DOD requirements. NNSA's mission 
is not just to produce a product; it's to serve a customer, and 
the customer are the people charged with the defense of the 
United States of America. So I'm uneasy if the customer is not 
happy.
    NNSA's decisions to ignore Navy requirements and delay the 
life extension of the W76 warhead is yet another example.
    Finally, the lack of a 5-year budget plan has instilled a 
level of uncertainty the 10-year modernization plan and over $7 
billion in DOD resources were determined to fix and to prevent.
    Every agency is facing unprecedented budget pressures. We 
are facing unprecedented budget pressures. We really are. We do 
not have the money to do everything that we need to do for this 
country. Congress does not fully understand it. I'm not sure 
it's understood down to the depths of all of our agencies, 
including DOE and DOD. It's just serious. We don't have the 
money. That's what Admiral Mullen meant when he said the debt 
is the greatest threat to our national security. It could cause 
us to make bad decisions with regard to how we defend this 
country.
    Every agency is facing challenges. However, DOD was able to 
maintain its commitment to modernizing the triad of delivery 
vehicles with minimal change. NNSA's decision to abandon 
cornerstone efforts at the CMRR facility at Los Alamos is 
troubling. Further, misplaced priorities like a nearly half a 
billion dollar increase to the $5.5 billion request for EM are 
unacceptable, given DOE's inability to meet critical national 
security requirements. So maybe I'm wrong about that. I'd like 
to hear that explained. That's the way our staff calculates an 
additional request for $500 million.
    The lack of leadership demonstrated in this request is 
indicative of the White House attempting to undermine the long-
term requirements in the agreement that was reached as part of 
the START Treaty, I am afraid. I know we're short money, but a 
serious agreement was made as part of that treaty to ensure 
that we modernize our nuclear weapons. That's something that 
most of us, I thought virtually all of us, had agreed to, and 
we're seeing a major retreat from that in this budget.
    The threat, uncertainty, and risk of the international 
environment is growing and more nuclear power is coming on 
line. The budget before us for NNSA, with misguided cuts, seems 
to exacerbate the risk. The fiscal problem before us will not 
be solved by degrading our ability to maintain a safe, secure, 
and reliable nuclear stockpile.
    Mr. Chairman, thank you for letting me express some 
concerns. I hope I have overstated the problem, and we'll give 
our witnesses a chance to explain.
    Senator Nelson. You certainly didn't candy-coat your 
opening statement. So we appreciate your candor. Thank you very 
much.
    At this point, I would like to submit for the record the 
opening statement of my colleague and a member of this 
subcommittee, Senator Lieberman.
    [The prepared statement of Senator Lieberman follows:]
           Prepared Statement by Senator Joseph I. Lieberman
    As I have expressed throughout the course of the Senate Armed 
Services Committee's hearings in relation to the fiscal year 2013 
defense authorization, I am deeply concerned about the reductions to 
our forces and deferment of crucial modernization programs caused by 
the constrained budget. We are pursuing these cuts to our national 
defense without sufficient reference to the continuing threats and 
challenges we face across the globe. I believe we need to consider 
steps in the fiscal year 2013 authorization process to mitigate the 
risks posed to our national security by these budget cuts.
    Our nuclear deterrent remains one of the most crucial aspects of 
our national defense. We may aspire to a more secure and peaceful world 
free of nuclear weapons but we must live in today's world where nuclear 
weapons are an unfortunate requirement for preserving the security of 
our country. As long as that is the case, the United States must 
maintain a credible deterrent capability. That requires investments in 
modernization of our nuclear weapons which have already been deferred 
for much of the past two decades. This budget envisions further delays 
to key elements of the modernization strategy, including a 2-year life 
extension of the B-61 gravity bomb, fielding of the Navy's refurbished 
W-76 warhead, and a minimum of a 5-year determent of the construction 
of the Chemistry and Metallurgy Research Replacement Nuclear Facility 
(CMRR-NF) at Los Alamos National Laboratory. These delays, particularly 
to the CMRR-NF, raise serious questions about our ability to develop 
and sustain the deterrent force envisioned in the 2010 Nuclear Posture 
Review. I hope we can work together to identify ways to provide more 
funding to NNSA Weapons Activities to change some of the decisions 
presented here.

    Senator Nelson. Mr. D'Agostino, the floor is now yours. 
Thank you.

 STATEMENT OF HON. THOMAS P. D'AGOSTINO, Ph.D., ADMINISTRATOR, 
 NATIONAL NUCLEAR SECURITY ADMINISTRATION, AND UNDER SECRETARY 
           FOR NUCLEAR SECURITY, DEPARTMENT OF ENERGY

    Mr. D'Agostino. Thank you, Mr. Chairman. Chairman Nelson, 
Ranking Member Sessions. Good afternoon and thank you for 
having me here to discuss the President's fiscal year 2013 
budget request. Your ongoing support for the men and women of 
DOE and NNSA and the work that we do really help us keep 
American people safe, help protect our allies, and it really 
has enhanced global security.
    In February, President Obama released his budget for 2013. 
Due in part to the constraints established by the BCA, this is 
a time to precisely target our investments. I want to assure 
you that NNSA and EM are being thoughtful, pragmatic, and 
efficient in how we complete our missions. We have continuously 
improved the way we operate and we're committed to doing our 
part in this constrained budget environment.
    I also want to acknowledge that this is the first time I've 
come before you with more than NNSA to discuss. In an effort to 
maximize the accomplishments of mission-critical projects and 
organize needs more closely with DOE resources, EM and the 
Office of Legacy Management (LM) were aligned under my office 
last August, August 2011. It's been less than a year since the 
realignment and we're already seeing tangible benefits from 
working in a more thoughtful and coordinated way.
    Still, NNSA and EM have separate budget requests and I'll 
talk about both here today. I know that both Don Cook and 
Admiral Donald from NNSA and Dave Huizenga from EM are 
testifying after I do, but I want to briefly discuss the 
President's 2013 request.
    For NNSA, the President's request is $11.5 billion, an 
increase of $536 million over the fiscal year 2012 
appropriation. The request reaffirms our commitment to building 
a 21st century nuclear security enterprise through innovative 
approaches to some of our greatest nuclear security challenges 
and key investments in our infrastructure. As Dr. Cook will 
detail for you, we're continuing our critical work to maintain 
the Nation's nuclear stockpile and ensuring that as long as 
nuclear weapons exist they are safe, secure, and effective.
    The request provides $7.58 billion for the weapons activity 
account to implement the President's strategy in coordination 
with our partners in DOD.
    We're also here this morning to discuss the President's 
budget request for NNSA's naval reactors program, as Admiral 
Donald will detail for you shortly. NNSA has helped American 
sailors reach destinations across the globe safely and reliably 
for decades and the $1.1 billion 2013 request will support the 
effort on the Ohio-class submarine replacement and modernize 
key elements of our infrastructure. I'll leave it to Admiral 
Donald to expand on that, but support for the President's 
request is key to our ability to support the nuclear Navy.
    EM's budget request of $5.65 billion enables the continued 
safe cleanup of environmental legacy brought out from 5 decades 
of nuclear weapons development and government-sponsored nuclear 
energy research. EM's cleanup priorities are based on risk, 
while continuing to meet the regulatory compliance commitments. 
Completing cleanup protects human health and the environment of 
communities surrounding our cities and sites--excuse me--
surrounding sites, and enables other crucial DOE missions to 
continue.
    By reducing the cleanup footprint, EM is lowering the cost 
of security, lowering costs of surveillance, infrastructure, 
and overhead activities that would otherwise continue for 
decades.
    A core value of EM is safety, which is incorporated into 
every aspect of the EM program, and the EM program has 
maintained a strong safety record, continually striving for a 
workplace free of accidents or incidents, and promotes a robust 
safety culture throughout our enterprise.
    NNSA, EM, and the Office of LM have many uniquely different 
challenges and each remains and operates separately. However, 
they also have some similar challenges and EM and LM's 
realignment under my role as the Under Secretary for Nuclear 
Security has allowed us to capitalize on the expertise that 
exists between the various programs in this portfolio, in areas 
such as project management, nuclear materials, and waste, 
nuclear safety and security. We've already seen the benefits of 
this realignment.
    For example, at the Savannah River Site, EM and NNSA are 
working very closely together to fully utilize the H Canyon 
Facility and support multiple missions, including converting 
about 3.7 metric tons of plutonium into suitable feed for 
NNSA's Mixed Oxide (MOX) Fuel Fabrication Facility, removing 
contaminants in the plutonium to make it amenable for use as 
MOX feed, and reducing the amount of plutonium that EM needs to 
package and send to the Waste Isolation Pilot Plant (WIPP) for 
disposal. These activities will occur in addition to EM 
utilizing H Canyon to disposition spent nuclear fuel in H 
Canyon that is not suitable for extended storage in the L 
Basin.
    At Oak Ridge, we're working together across our programs in 
order to accelerate the transfer of certain components of the 
uranium-233 inventory at the Oak Ridge National Laboratory that 
are valuable for national security applications from EM to 
NNSA. The transfer of this material will support ongoing NNSA 
missions related to safety, nuclear emergency response, and 
special nuclear material measurement and detection. This 
initiative will result in significant cost savings to the EM 
program and enable EM to move forward on cleanup of nuclear 
facilities.
    EM has also established a partnership with NNSA to build 
upon the success in NNSA with the supply chain management 
center, in other words managing the way we procure our 
components and commodity products by leveraging our buying 
power across the combined EM and NNSA complexes for commonly 
used goods and services with the objective of realizing cost 
savings for the EM program similar to the cost savings achieved 
in NNSA. These cost savings have well exceeded the $300 million 
mark.
    In addition, NNSA is also working closely with LM to 
benchmark long-term surveillance and maintenance costs. Large 
closed sites with ongoing groundwater issues such as Fernault, 
Rocky Flats, Weldon Springs, Tuba City, and Mound may have 
post-closure requirements similar to some of the Savannah River 
Site facilities. So we're learning from each other by comparing 
scope and costs to refine our estimates.
    I'm proud of what we've been able to accomplish so far and 
I'm excited about what we'll accomplish next. We're dedicated 
to achieving the President's nuclear security objectives, 
continuously improving the way we do business, and doing our 
part in this tough fiscal environment.
    Thank you again for having me today and I'll be happy to 
answer any questions that you may have.
    [The prepared statement of Mr. D'Agostino follows:]
            Prepared Statement by Hon. Thomas P. D'Agostino
                              introduction
    Chairman Nelson, Ranking Member Sessions, members of the 
subcommittee, good morning and thank you for having me here to discuss 
the President's fiscal year 2013 budget request. Your ongoing support 
for the men and women of the Department of Energy and the work they do, 
and your bi-partisan leadership on some of the most challenging 
national security issues of our time, has helped keep the American 
people safe, helped protect our allies, and enhanced global security.
    Earlier this month, President Obama released his budget for fiscal 
year 2013. Due in part to the constraints established by the Budget 
Control Act, this is a time to precisely target our investments. I want 
to assure you that the National Nuclear Security Administration (NNSA) 
and the Office of Environmental Management (EM) are being thoughtful, 
pragmatic, and efficient in how we complete our missions.
                     improving through realignment
    First, I want to acknowledge that this is the first time I have 
come before you with more than NNSA to discuss. In an effort to 
maximize the accomplishments of mission-critical projects and organize 
needs more closely with DOE's resources, EM and the Office of Legacy 
Management (LM) were aligned under my office in August 2011.
    NNSA and each office have uniquely different challenges, and each 
remains and operates separately. However, they also have some similar 
challenges, and EM and LM's realignment under my role as the Under 
Secretary for Nuclear Security has allowed us to capitalize on the 
expertise that exists between the various programs in this portfolio in 
areas such as project management, nuclear materials and waste, and 
nuclear safety and security. We have already seen the benefits from 
this realignment.
    At Savannah River Site, EM and NNSA are working closely together to 
utilize the H-Canyon facility and support multiple missions including: 
converting about 3.7 metric tons of plutonium into suitable feed for 
NNSA's Mixed Oxide Fuel (MOX) Fabrication Facility; removing 
contaminants in the plutonium to make it amenable for use as MOX feed; 
and reducing the amount of plutonium that EM needs to package and send 
to the Waste Isolation Pilot Plant for disposal. These activities will 
occur in addition to EM utilizing H-Canyon to disposition spent (used) 
nuclear fuel in H-Canyon that is not suitable for extended storage in 
L-Basin.
    At Oak Ridge, we are working together to accelerate the transfer of 
certain components of the Uranium-233 inventory at Oak Ridge National 
Laboratory that are valuable for national security applications from EM 
to NNSA. The transfer of this material will support ongoing NNSA 
missions related to safety, nuclear emergency response, and special 
nuclear material measurement and detection. This initiative will result 
in cost savings for the EM program and enable EM to move forward on 
cleanup of nuclear facilities.
    EM has established a partnership with NNSA to build upon their 
success with the Supply Chain Management Center, leveraging buying 
power across the combined EM and NNSA complexes for commonly used goods 
and services with the objective of realizing cost savings for the EM 
program similar to those NNSA has achieved.
    In addition, NNSA is also working closely with LM to benchmark 
long-term surveillance and maintenance costs. Large closed sites with 
ongoing groundwater issues, such as Fernald, Rocky Flats, Weldon 
Spring, Tuba City, and Mound, may have post-closure requirements 
similar to some of the Savannah River facilities, so we are learning 
from each other by comparing scope and cost to refine our estimates.
    It has been less than a year since the realignment, and we are 
already seeing tangible benefits from working in a more thoughtful, 
coordinated way. Still, NNSA and EM have separate budget requests, and 
I'll talk about both here today.
 nnsa: achieving the president's nuclear security objectives, shaping 
                               the future
    In April 2009 in Prague, President Obama shared his vision for a 
world without nuclear weapons, free from the threat of nuclear 
terrorism, and united in our approach toward shared nuclear security 
goals. The President's fiscal year 2013 request for NNSA is $11.5 
billion, an increase of $536 million, or 4.9 percent, over the fiscal 
year 2012 appropriation. The request reaffirms the national commitment 
to his vision, applying world-class science that addresses our Nation's 
greatest nuclear security challenges and building NNSA's 21st century 
nuclear security enterprise through key investments in our people and 
infrastructure, including the revitalization of our existing 
facilities.
    We are doing this in a number of key ways. We are continuing our 
critical work to maintain the Nation's nuclear stockpile, and ensuring 
that, as long as nuclear weapons exist, the stockpile is safe, secure, 
and effective. The fiscal year 2013 budget provides $7.58 billion for 
our Weapons Activities account, an increase of 5 percent over fiscal 
year 2012, to implement the President's strategy in coordination with 
our partners at the Department of Defense.
    The President continues to support our life extension programs 
(LEP) including funding for B61-12 activities in response to the 
Nuclear Weapons Council's (NWC) anticipated approval and entry into 
Phase 6.3 Development Engineering. He has also requested increased 
funding for our Stockpile Systems to support the W78 and W88 life 
extension study, which I discussed with you last year.
    The President's budget also reflects his commitment to completing 
key dismantlements, with $51.3 million requested in fiscal year 2013 to 
continue reducing the number of legacy nuclear weapons retired from the 
stockpile. NNSA has previously committed to completing the 
dismantlement of all warheads retired as of fiscal year 2009 by fiscal 
year 2022, and we continue to be on a path to do that. In fact, in 
fiscal year 2011, NNSA completed the dismantlement of the last B53 
nuclear bomb, one of the largest ever built, ahead of schedule and 
under budget. We also eliminated the last components of the W70 warhead 
which was originally in the U.S. Army's arsenal.
    Our request for investments in the science, technology, and 
engineering that support NNSA's missions will ensure that our national 
security laboratories continue to lead the world in advanced scientific 
capabilities. $150.6 million is requested for our engineering campaign, 
which reflects the need for validation-related testing and surety 
options required for current and future refurbishments; $350.1 million 
is requested for our science campaign, expanding and refining our 
experiments and capabilities, which coupled to simulation, improves our 
confidence in and broadens the national security application of our 
predictive capabilities; and $460 million is requested for our inertial 
confinement fusion and high yield campaign, to operate NNSA's suite of 
world-leading high energy density facilities--National Ignition 
Facility (NIF), Omega, and Z--to support stockpile stewardship in a 
safe and secure manner.
    The Advanced Simulation and Computing campaign's request of $600 
million is requested for the continued improvement of full system 
calculations and metric suites that are essential to annual assessments 
and also to future stockpile changes. Our capabilities directly impact 
our stockpile by generating incredibly sophisticated models against 
which we can validate our nuclear weapons codes. Not only has 
supercomputing helped us solve some existing questions such as energy 
balance, it also allows us to plan for issues that impact the future 
health of our deterrent: aging, component lifetimes, and new models for 
abnormal and hostile environment certification. Supercomputing is 
critical for LEPs and stockpile modernization: the implementation of 
various concepts such as reuse and enhanced multipoint safety are only 
possible with the power of ASC platforms.
    For over a decade, NNSA has been building the science, technology, 
and engineering tools and capabilities needed to take care of the 
stockpile. We are now entering a time when we will fully utilize these 
analytical tools and capabilities towards the mission of maintaining a 
safe, secure, and effective stockpile and performing the necessary life 
extension work. These capabilities also provide the critical base for 
nonproliferation and counterterrorism work, allowing us to apply our 
investments to the full scope of our mission.
    To support our stockpile and to continue producing the world-class 
capabilities we need to modernize our Cold War-era facilities and 
maintain the Nation's expertise in uranium processing and plutonium 
research. This budget includes $2.24 billion to maintain our 
infrastructure, and execute our construction projects.
    The President also requests support for infrastructure improvements 
necessary to maintain the stockpile well into the future. Major efforts 
include extending the life of enduring facilities needed for Directed 
Stockpile Work (DSW) and ST&E program requirements, construction of the 
Uranium Processing Facility at Y-12, and construction of the TRU Waste 
Facility at Los Alamos National Laboratory. Funding will also provide 
for the start of construction of the Electrical Infrastructure Upgrades 
project at Lawrence Livermore and Los Alamos National Laboratories, and 
continued construction activities for various projects at Los Alamos 
and Sandia National Laboratories, the Y-12 National Security Complex, 
and Pantex. The budget request also includes the resources we need to 
ensure a comprehensive physical and cyber security posture that 
provides strong security to support NNSA missions--protecting our 
nuclear materials, facilities, and information.
    However, our nuclear deterrent is only one part of NNSA's mission. 
Our nonproliferation programs perform an equally critical function. One 
of our most important missions has been to support the administration's 
commitment to secure the most vulnerable nuclear material across the 
globe in 4 years. Our accomplishments in securing plutonium and highly 
enriched uranium around the world have made it significantly more 
difficult to acquire and traffic the materials required to make an 
improvised nuclear device, and I am proud to say that we are on track 
to meet our goals to remove or dispose of 4,353 kilograms of highly 
enriched uranium and plutonium in foreign countries, and equip 
approximately 229 buildings containing weapons-usable material with 
state-of-the-art security upgrades.
    The Defense Nuclear Nonproliferation budget request provides the 
$2.46 billion to continue these and other critical nonproliferation and 
nuclear security efforts. Our continued focus on innovative and 
ambitious nonproliferation and nuclear security efforts is vital. The 
threat is not gone, and the consequences of nuclear terrorism and state 
proliferation would be devastating. Detonation of a nuclear device 
anywhere in the world would lead to significant loss of life, and 
overwhelming economic, political, and psychological consequences. We 
must remain committed to reducing the risk of nuclear terrorism and 
state-based proliferation.
    The fiscal year 2013 budget request also gives us the resources we 
need to maintain our one-of-a-kind emergency response capabilities, 
which allow us to respond to a nuclear or radiological incidents 
anywhere in the world. In fiscal year 2011, we were able to assist the 
U.S. military, military families, and the Japanese people by deploying 
our unique emergency response assets in the aftermath of devastating 
tsunami that affected the Fukushima Daiichi Nuclear Power Plant.
    In response to the President's concern regarding the threat of 
nuclear terrorism, which is also a key goal within the 2010 Nuclear 
Posture Review, we have established a new organization that is now the 
focal point for all counterterrorism and counter proliferation 
activities within NNSA. This organization, the Office of 
Counterterrorism and Counterproliferation, not only provides unique 
technical contributions based on NNSA's core nuclear science and 
technology expertise, but also is designed to coordinate all nuclear 
counterterrorism, counterproliferation, and post-detonation nuclear 
forensics related efforts without drastic restructuring.
    In addition, NNSA's Naval Reactors program directly supports all 
aspects of the U.S. Navy's nuclear fleet, which encompasses the Navy's 
submarines and aircraft carriers, over 40 percent of the U.S. Navy's 
major combatants. Currently, the nuclear fleet is composed of 54 attack 
submarines, 14 ballistic missile submarines, 4 guided missile 
submarines, and 11 aircraft carriers. Over 8,300 nuclear-trained Navy 
personnel safely operate the propulsion plants on these ships all over 
the world, and their consistent forward presence protects our national 
interests. Our $1.1 billion fiscal year 2013 request will support the 
refueling overhaul for the S8G Land-based Prototype reactor, the design 
of the Ohio Replacement reactor plant, and recapitalization of our 
naval spent nuclear fuel infrastructure.
    Each of the projects is critical to fulfillment of the Navy's 
longer term needs. The S8G Land-based Prototype Refueling Overhaul 
reactor plant has served Naval Reactors' needs for research, 
development, and training since 1978, and the reactor provides a cost-
effective testing platform for new technologies and components before 
they are introduced. To continue vital research capabilities, as well 
as train sufficient operators to man the Fleet, the S8G Land-based 
Prototype Refueling Overhaul must begin in 2018. The Ohio Replacement 
reactor plant design continues and the fiscal year 2013 requested 
amount supports continuing this work to meet the Navy's revised 
schedule and procurement of reactor plant components in 2019 (to 
support a 2021 lead-ship procurement). We need to recapitalize its 
naval spent fuel infrastructure in a cost-effective way that does not 
impede the refueling of active ships and their return to operations. 
The existing facility is more than 50 years old, and was never designed 
for its current primary mission of packaging naval spent nuclear fuel 
for permanent dry storage.
    Finally, $411 million is requested for NNSA's Office of the 
Administrator account. This funds Federal personnel and provides for 
resources necessary to plan, manage, and oversee the operation of NNSA 
missions which strengthen U.S. security.
                          nnsa: doing our part
    We are committed to being responsible stewards of taxpayer dollars. 
We have taken steps to ensure that we are building a capabilities-based 
enterprise focused on needs and solutions. We view this constrained 
budget environment as an additional incentive to ask ourselves how we 
can re-think the way we are operating, how we can innovate, and how we 
can get better.
    For example, in close consultation with our national laboratories 
and national security sites, we are adjusting our plutonium strategy by 
deferring for at least 5 years construction of the Chemistry and 
Metallurgy Research Replacement Nuclear Facility (CMRR-NF) project at 
Los Alamos National Laboratory and focusing instead on how we can meet 
our plutonium needs on an interim basis by using the capabilities and 
expertise found at existing facilities. Utilizing existing facilities 
will allow us to meet anticipated near term requirements for plutonium 
operations while focusing on other key modernization projects. 
Deferring CMRR-NF will have an estimated cost avoidance from 2013 to 
2017 that totals approximately $1.8 billion, which will help offset the 
costs of other priorities such as Weapons Lifetime Extension programs 
and other infrastructure needs.
    We have also updated our strategy to stop the spread of dangerous 
nuclear material as we meet the President's 4-year lockdown goal. We 
have developed an innovative approach to scientist engagement tailored 
for an age when knowledge spreads effortlessly through Google, 
Facebook, and Twitter.
    We are not resting on old ideas to solve tomorrow's problems--we're 
shaping the future of nuclear security, and we're doing it in a 
fiscally responsible way. However, I want to stress that as we make 
adjustments and look toward the future, our plans are based on the 
fiscal year 2013 budget request, which give us the resources we need to 
carry out our mission. Budget uncertainty adds cost and complexity to 
how we achieve our goals. You have been supportive of our efforts in 
the past, I ask again for your help in providing the stability we need 
to do our jobs efficiently and effectively.
                      nnsa: continuously improving
    I would like to acknowledge that I have come before you in the past 
and talked at length about how NNSA has been working to change the way 
we do business. I am proud of the work the men and women of our NNSA 
have done to come together and operate as one. We are defining 
ourselves as a fully integrated enterprise that operates efficiently, 
is organized to succeed, that performs our work seamlessly, and speaks 
with one voice.
    We are improving everywhere, from our governance model to our 
network infrastructure, from our contracting processes to leadership 
and development programs. We are improving business processes by 
implementing the ISO 9001 standard, looking toward the future through a 
workforce analysis, and improving efficiency through consolidated 
contracts.
    We are continuously improving so we are able to do the work the 
American people need us to do, in a time when everyone is looking to do 
more with less. We are positioning ourselves for the next decade by 
making big decisions focused on the future.
    For example, after more than 2 years of analysis and outside 
reviews, we released an RFP for the combined management of the Y-12 
National Security Complex and Pantex Plant, with an option for phase-in 
of Tritium Operations performed at the Savannah River Site. Combining 
contracts and site offices will allow us to improve performance, reduce 
the cost of work, and operate as an integrated enterprise. We also 
decided to compete the contract for management and operation of Sandia 
National Laboratories, a move designed to find meaningful improvement 
in performance and reduce cost for taxpayers.
    We have taken other significant steps to continue improving, from 
top-to-bottom. We created an Acquisition and Project Management 
organization to help institutionalize our commitment to improving the 
way we do business. This move will improve the quality of our work 
while keeping our projects on time and on budget.
    We awarded a Blanket Purchasing Agreement for Enterprise 
Construction Management Services. The BPA will standardize our approach 
to project management across the enterprise and provide subject matter 
experts to provide independent analysis and advice related to the 
design and construction of facilities.
    Importantly, we have institutionalized a culture of safety. Through 
a unique series of Biennial Reviews, including reviews at Headquarters, 
we have improved nuclear safety across our Nuclear Security Enterprise. 
We have provided objective, value-added information to managers that 
ensure our nuclear safety oversight is consistent and effective. Since 
the reviews began in 2005, we have seen continuous improvement at every 
site.
                        environmental management
    The Senior Advisor for the Office of Environmental Management will 
provide more detail to you through separate testimony, but I want to 
note that EM's fiscal year 2013 budget request of $5.65 billion enables 
the continued safe cleanup of the environmental legacy brought about 
from five decades of nuclear weapons development and government-
sponsored nuclear energy research. EM's cleanup priorities are based on 
risk while continuing to meet regulatory compliance commitments. 
Completing cleanup protects human health and the environment of the 
communities surrounding our sites and enables other crucial DOE 
missions to continue. By reducing the cleanup footprint, EM is lowering 
the cost of security, surveillance, infrastructure, and overhead 
activities that would otherwise continue for years to come. A core 
value of EM is safety, which is incorporated into every aspect of the 
EM program. EM has maintained a strong safety record, continuously 
strives for a workplace free of accidents or incidents, and promotes a 
robust safety culture throughout the complex.
                               conclusion
    Our mission is vital, and your past support has been key in helping 
us accomplish it. The fiscal year 2013 budget reflects our commitment 
to keeping the American people safe while continuously improving and 
doing our part in a time of fiscal austerity. We are looking toward the 
future and building an organization that is aligned to succeed. I look 
forward to working with each of you to help us do that. Thank you.
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    
    
      
    Senator Nelson. The fiscal year 2013 budget submission, as 
I indicated in my opening statement, for the weapons program, 
didn't contain a 5-year projection, and in some cases where it 
did, such as for naval reactors or nonproliferation, it simply 
indexed out the out-years--indexed the out-years by inflation, 
making it impossible to satisfy the modernization report which 
was required under section 1043 of last year's defense 
authorization. Can you give us some idea of how this happened 
or how this would be consistent with what we were seeking a 
year ago?
    Mr. D'Agostino. Absolutely. The fiscal year 2012 
appropriation came through in December of last year, just 
basically a month before budgets were to be locked down. That, 
in addition to what we've discussed already in our statements 
about the BCA out-year commitments, put us in a situation that 
is documented in the President's budget itself, that the out-
year numbers in essence are a placeholder to reflect 
essentially the limits imposed by the BCA, giving us time to 
work with our DOD partners in order to work on the details of 
the out-years, the details of the out-years associated with 
making sure that we can fully support the LEPs as we've laid 
out and requested in this budget, making sure that we can 
follow through on our commitments on infrastructure 
improvements for both UPF, the High Explosive Pressing 
Facility, and continue to do our plutonium capabilities.
    The details of how the out-years will look is being worked 
on. We have a joint team with DOD to look at this, and there's 
a lot of concern, of course. I know, I recognize that both 
Departments, the NNSA and DOD having some challenges. Of 
course, we have challenges. We have a very significant fiscal 
environment and we have a tremendous amount of work to do. But 
that's why we're working together on the same team in order to 
make sure that these out-years are well-identified and laid 
out.
    We expect to have an update to what's now called the 1043 
report, essentially which lays out those out-years. We expect 
to have that update report done jointly by DOD and NNSA later 
this year.
    Senator Nelson. When you say later, do you have some idea 
about how much later?
    Mr. D'Agostino. I know the teams are working to get 
essentially agreement some time this summer. The question would 
be exactly how much detail we put into it. We want the detail 
because, of course, we need it to get that fiscal year 2014 
budget built. That's the key budget and out-years that we want 
to make sure that we're all on the same page. We're together on 
fiscal year 2013. We're working the out-years together and we 
want to get this completed because we know we have a commitment 
to Congress in order to give you the 1043 report.
    Senator Nelson. In the report, you're deferring the 
construction of the CMRR facility, which is a key tenet of the 
commitment to the Senate and Congress during the New START 
debate. You're adding $150 million to the budget for UPF 
instead. My understanding is it may cost $500 million over 5 
years for such a deferral, and the director of Los Alamos has 
flatly stated that he cannot meet the DOD requirement for 50 to 
80 plutonium pits per year. But yet you're proposing instead to 
ship plutonium all across the United States as an alternative.
    Just how committed--how committed can we feel to this 
alternate plutonium strategy if during the course of 
congressional investigation it's determined that it's just too 
costly and makes no practical sense to engage in it? Once the 
cost is known, it could very easily exceed the capabilities to 
cover it.
    Mr. D'Agostino. We're deeply committed to ensuring that the 
Nation has the plutonium capability it needs to do the job, do 
the job to support the nuclear weapons stockpile, do the job in 
order to do the nuclear forensics for emergency response, and 
do the job that we know needs to happen in order to satisfy our 
nuclear nonproliferation work.
    We do have capabilities in our enterprise. We have 
capabilities, significant capabilities, at Los Alamos. We have 
capabilities at Nevada at the Device Assembly Facility, and we 
have capabilities at Lawrence Livermore. What we plan on doing 
is making full use of these capabilities. We expect the 
deferral for 5 years of the CMRR Nuclear Facility Project, not 
the cancellation but the deferral, to defer $1.3 billion of 
liability on the government while we fully utilize the 
capabilities that we have.
    There are a couple of things that have changed from last 
year that I think are important to point out, because I do--
it's very fair to ask the question, what's changed in the last 
year and why would we go about making this change since it was, 
as mentioned. A couple of things have changed. First of all, we 
now are implementing what is known as modern dose conversion 
factors into the safety basis analysis in our enterprise. What 
that allows us to do is use modern, agreed-upon international 
standards for safety basis calculations. This in effect has 
allowed us to fully utilize the existing brand-new building 
that you have authorized and has been appropriated and we have 
done, which is the CMRR Radiological Facility.
    This just one simple change of using international 
standards, using modern international standards, has allowed us 
to significantly increase the amount of work we can actually do 
in a building that's brand new, that was just built for 
plutonium.
    The second thing that's changed dramatically since last 
year is the laboratory has just done a marvelous job in 
reducing the amount of material inside the PF4, which is the 
roughly 25-year-old plutonium facility that exists. By reducing 
the amount of material significantly, this allows us to 
essentially--this was one of the key elements of the nuclear 
facility, to build a very large plutonium vault. The need and 
the pressure to build that very large plutonium vault has 
decreased. We still need a modern plutonium vault, but what we 
can do is really take advantage of the existing vault that the 
Nation has right now.
    Both of these changes, along with the fact that we have now 
new insight into our fiscal year 2012 appropriation, which is 
over $400 million less than what we needed to do the job, and 
we have the BCA out-year limitations which put additional 
pressure, caused us to look, take a fresh new look at how we do 
business, not just programmatically, but also internally on how 
we do business.
    I recognize you may have more questions on that, so I'll 
stop.
    Senator Nelson. My time has expired, but was the decision 
to try to find more effective ways of space utilization driven 
by trying to control costs or was it just on its face making 
sense to utilize the space better? Sometimes the costs can 
drive it. What we don't want to see is costs driving us into a 
less than excellent way of handling this project.
    Mr. D'Agostino. Absolutely, Mr. Chairman. It's driven by a 
couple of things. Primarily it's driven by our recognition with 
DOD that we have a tremendous amount of real work that we have 
to do on the stockpile. That's number one. Given the fact that 
we have this tremendous pressure on us, it has caused us to 
look at all of our business lines with increased scrutiny. 
That's my obligation to you, sir, and it's my obligation to the 
taxpayers, it's my obligation to the Secretary and the 
President, to go look at these things in a way that makes sure 
that we are capitalizing on what we currently have from a 
capabilities standpoint--that's the most important thing, 
having a plutonium capability to take care of the stockpile. I 
am convinced--and Don Cook can describe the work that he's 
specifically doing with the laboratory--that it's important to 
continue the work on the stockpile itself, particularly the 
life extension on the B61 bomb and the studies in order to get 
these things done, instead of just saying that we would build a 
large facility.
    We want to exercise our scientists and engineers at our 
laboratories. It's like exercise, it's good, it's good for our 
brain and our brains are at the laboratories where they do the 
work for us.
    Senator Nelson. Okay, thank you.
    Senator Sessions.
    Senator Sessions. Thank you.
    I would just say if you can make a proposal that shows that 
you can do the work without a multi-billion dollar new 
building, I'd be interested in hearing it. Perhaps you could. 
Everybody would like a new building and sometimes you really 
could use one. Sometimes you could use one, but you can't 
afford one.
    But we do have a mission we can't afford to miss, the 
mission of modernizing our nuclear facilities.
    Mr. D'Agostino, how many facilities are there directly 
involved in the nuclear manufacture and modernization effort?
    Mr. D'Agostino. I want to make sure I understand your 
question correctly, Senator Sessions.
    Senator Sessions. You can define it as you'd like maybe.
    Mr. D'Agostino. Okay.
    Senator Sessions. What do you think would be relevant to my 
question?
    Mr. D'Agostino. I think we have a real concern on uranium 
production and manufacture.
    Senator Sessions. I just asked how many are there.
    Mr. D'Agostino. Oh, how many facilities are there involved?
    Senator Sessions. Yes.
    Mr. D'Agostino. In order to take care of our stockpile?
    Senator Sessions. Right.
    Mr. D'Agostino. Hundreds of facilities, sir.
    Senator Sessions. What about the manufacture and 
maintenance of them, the core labs and all that are involved? 
You can see where I'm going. My question is, we're having a 
base realignment and closure (BRAC). Probably we're looking at 
another BRAC, and I'm wondering if there could be savings from 
some consolidation for efficiency purposes in our historic 
operations.
    Mr. D'Agostino. We've looked at this question. I think it's 
a great question to ask, and I'll give you the insight of the 
analysis we have done over the last couple of years here.
    Senator Sessions. Briefly.
    Mr. D'Agostino. Okay, absolutely. The most important thing 
for us is to maintain capabilities in all the disciplines that 
we need to take care of the assessment of the stockpile. So we 
look at where all of those capabilities exist around our whole 
enterprise, and we've consolidated those particular 
capabilities. So we've BRAC'ed along not geographic bounds, but 
BRAC'ed along functional areas.
    So we've decided that it's better to have one area in the 
country to do uranium work, one area in the country where we 
press large sizes of high explosives, one area in the country 
where we do environmental testing on our stockpile itself. What 
that's allowed us to do is consolidate nuclear material, save 
money on security costs, and focus our investments so that we 
don't at the same time we're building a high explosive press at 
the Pantex facility, we don't rebuild the high explosive 
pressing capability that exists at Los Alamos, that existed for 
many decades during the Cold War.
    So we are BRAC'ing along these functional areas: high 
explosives, uranium, plutonium.
    Senator Sessions. You're doing that as you would like to 
reorganize, whereas in BRAC an independent commission 
ultimately tells DOD or recommends to Congress how to do that, 
and of course takes inputs from the agency, the department 
that's affected.
    With regard to the current situation, you don't disagree, 
do you, that the budget you have does not meet the necessary 
DOD requirements?
    Mr. D'Agostino. I agree that the budget that we have before 
us meets the needs that we've laid out and with DOD on working 
on the B61, taking care of the W78 and the W76 warheads.
    Senator Sessions. But they're not hampered--they don't 
believe that it fully meets their requirements, isn't that 
correct?
    Mr. D'Agostino. It depends on who the ``they'' are, sir.
    Senator Sessions. Your customer is the one you need to keep 
happy.
    Mr. D'Agostino. Absolutely.
    Senator Sessions. So do you dispute that? As presently 
configured, the amount of money and the plans that you have to 
spend it don't meet the requirements that DOD has said they 
need to be met.
    Mr. D'Agostino. The NWC, which represents the strategic 
commander, represents the Under Secretary for Acquisition, 
Technology, and Logistics in DOD, the Under Secretary for 
Policy, and the Chairman and Vice Chairman of the Joint Chiefs 
of Staff, agree that the President's budget that we've 
submitted addresses what needs to be done, and--I have to add 
the ``and'' here because I think it's an important piece of 
this--and that DOE and DOD need to work together, which we are 
doing, to study the out-year concerns and making sure that we 
get the out-years right.
    Those are the requirements that we have before us and this 
budget actually does that.
    Senator Sessions. Is it true that this budget would result 
in a 2-year delay of the B61 LEP, moving the first production 
unit from 2017 to 2019?
    Just yes or no? Does it do that? 2017 is what DOD said they 
needed, did they not?
    Mr. D'Agostino. No, DOD supports the fiscal year 2013 
budget, which says 2019.
    Senator Sessions. Is it true that this budget would delay 
the completion of the W76 LEP by 4 years and that the Navy in 
response has publicly expressed concern over that?
    Mr. D'Agostino. It's true that this budget accurately shows 
that we have an adjustment in our W76 production rate in order 
to meet the Navy's operational requirements. I don't keep track 
of what every Navy person says publicly, but I'm former Navy, 
so I believe I can say that. But at the same time, we have a 
program and budget that is supported by the NWC.
    Senator Sessions. When you get to the last lick and the 
things are up before them and they have to sign off sometimes, 
I'm not sure that it's a matter of anything other than 
basically no choice.
    Is it true that this budget would delay the previously 
agreed to schedule for the W78-88 LEP by 3 years to 2023?
    Mr. D'Agostino. It's true that the budget that we have 
before us causes us to relook at the W78 cycle. These three 
items, the W78-88 study, the W76 production rate specifically, 
and the out-years associated with that are a part of the study 
that we're doing with DOD on our out-year program.
    Senator Sessions. Is it true that the budget did not 
provide the resources necessary to meet the DOD requirement for 
developing a pit production capacity and capability of up to a 
minimum of 50 to 80 pits per year in 2022?
    Mr. D'Agostino. This budget proposes a deferral of the 
CMRR, which is a 5-year deferral of the 50 to 80 requirement 
that you mention.
    Senator Sessions. That would be to 2027 from 2022?
    Mr. D'Agostino. The deferral has to do with the CMRR, would 
have to do, depending on when the CMRR Nuclear Facility starts 
construction.
    Senator Sessions. According to the OMB budget tables, over 
the next 10 years DOD will transfer $7.1 billion in budget 
authority to NNSA in support of the memorandum of agreement 
that was signed in May 2010 dealing with stockpile 
modernization and the CMRR. Given that the NNSA budget no 
longer meets the terms of the DOD-DOE agreement, does NNSA 
intend to return the money back to DOD?
    Mr. D'Agostino. Given the fact that we've received 
significantly less appropriation by Congress in fiscal year 
2012, over $400 million, it's very difficult to recover from 
that kind of an adjustment.
    Senator Sessions. You've told us these cuts, you're okay 
with them, everybody's fine, there's no problem with these 
cuts.
    Mr. D'Agostino. Senator, I said we have significant----
    Senator Sessions. I'm showing you that you're delaying the 
plans significantly in critical function after critical 
function. You say everything's okay, everybody signed off on 
it. But we had an agreement at the time the START thing was 
done. Senator Kyl executed it. I don't think it's being met. I 
think it's being missed, and we need to have a conversation 
that's connected to reality.
    The reality is that things have slipped significantly from 
what we thought we were heading toward. Isn't that true?
    Mr. D'Agostino. Senator, with great respect, the reality 
also is true that NNSA was appropriated more than $400 million 
less than what we needed to do the job, and that you cannot 
jump back on the saddle. The President has been very clear for 
the last 2 years in this commitment. We've put forth and 
requested 10 percent increases to this particular program. The 
message we get back is that the environment doesn't exist to 
support that kind of an increase. We've gotten 5 percent 
increases consistently. Therefore it has caused us to relook at 
this program. That's the reality, unfortunately, that I see 
from my end. As a result of that, I want to take--we're taking 
a clean look, not at the program requirements--we are not 
backing down on the LEP, we are not backing down on a very 
significant operationally needed infrastructure requirement on 
uranium processing. These are absolutely critical. In my view, 
this is about what does it take to get the job done to meet the 
DOD requirements.
    We are working very closely with DOD. I recognize that our 
departments, both DOE and DOD, are large departments, but we're 
working very closely at the core center to evaluate the out 
years situation. We want to solve this problem. We know we can 
solve this problem. It will require us to look at governance 
changes, of which I have--there are many things we can do in 
the governance area, and I can describe some of them.
    But that's what we have to do. We have to figure out how to 
address and meet the Nation's needs, and I'm committed to that, 
for nuclear security----
    Senator Sessions. My time is up, but we're all committed, 
but we need to understand that the funding is not followed 
through to maintain the goals that we'd set. We might as well 
be honest about that and put it out here.
    I'm saying that if DOE were run by private business I 
believe you'd be running more efficiently. That's just my 
opinion. I don't know how many buildings we'd have to build. I 
don't know how many different facilities we'd have to keep out 
there to keep politicians happy. We all like it in our 
neighborhood. I'm an offender, too.
    But we're at a crisis. We're running out of money and we 
need to do this as a core function of government. I do hope 
that as we go forward somehow we can get DOD and DOE together, 
make this occur with the least possible cost.
    Thank you, Mr. Chairman.
    Senator Nelson. Thank you.
    Let me ask the question this way. Is it your opinion that, 
even though you're now walking away from, let's say, new 
construction, that what you're doing will not adversely impact 
the core function that we have of dealing with our nuclear 
warheads and the other structural requirements for those?
    In other words, I thought we were going to have to have a 
new building because it was going to take the new building as a 
new--as something that is required to meet those functions. 
Now, I'm certainly not going to criticize you for finding other 
ways of doing it. As a matter of fact, I praise somebody that 
finds a cheaper way of doing the same thing to get the same 
result. But I think what the fear is that we don't get the same 
result here because we don't have enough money in the budget 
and we're patching rather than building. I don't know. That's 
the concern I think my colleague has and, frankly, I have it, 
too.
    Mr. D'Agostino. Mr. Chairman, there's a term called ``risk 
management'' that we use. Sometimes we throw it around blandly, 
if you will. But this is something we looked at very closely. 
Dr. Cook has worked with the laboratory on this idea of 
deferral of the CMRR, about looking at what capabilities exist 
across our enterprise in order to ensure that we are accepting 
the right amount of risk in order to meet the Nation's needs.
    We're confident that a 5-year deferral is not going to 
impact our ability to take care of our stockpile. It will 
continue in our ability to do the material characterization and 
analytical chemistry work that we need to do to take care of 
the stockpile. The Nation will need ultimately a replacement 
capability because we have a 30-year-old facility right next 
door that's part of our manufacturing facility, we have a 50, 
close to 60-year-old facility that's doing the material 
characterization and analytical chemistry work that we have 
right now. But we're going to get out of that 60-year-old 
facility and we're going to use the new part of CMRR that's 
actually built and done, with the changes that I have 
personally signed up to on using these modern safety codes, in 
order to allow us to ramp up the amount of work that actually 
can happen in this radiological facility.
    That change alone has meant a lot to both laboratory 
directors, because they now know that they're in the business; 
they can do more with the facilities that they have this year 
and out in the future than they could have done last year. That 
buys down a lot of the risk.
    Senator Nelson. Let's see. The fiscal year 2010 defense 
bill asked the National Academy of Sciences to examine how 
effectively NNSA was managing the quality of science and 
engineering at the national laboratories. I know you're 
familiar with this report and its findings. In the second 
report to Congress on the organization and operation of NNSA, 
dated February 25, 2002, Administrator Gordon laid out a very 
basic principle on the NNSA governance, stating: ``Federal 
employees, with contractor input, will establish broad program 
objectives and goals. Contractors, in consultation with Federal 
employees, will be given the flexibility to execute programs 
efficiently and will be held accountable for meeting those 
goals and objectives.''
    He further went on to say: ``NNSA will develop and 
implement a simpler, less adversarial contracting model that 
capitalizes on private sector expertise and experience of its 
contractors, while simultaneously increasing the 
accountability, with high performance and responsiveness.''
    Now, the 2002 report sounds like today. Do you think that 
NNSA today is meeting those original goals laid out by 
Administrator Gordon?
    Mr. D'Agostino. We've met some of them. We haven't met all 
of them, and our commitment is to meet all of those particular 
goals. If I could talk about, just for a second about the 
National Academy of Sciences report. One of the first 
recommendations of the report had to do with it reaffirmed 
essentially our vision to take a look at these, what previously 
had been called nuclear weapons laboratories, and we 
conscientiously said these are national security laboratories, 
these are laboratories that take care of a broad range of 
national security needs, not just in DOE, but also in the DOD, 
Intelligence Community, and Department of Homeland Security.
    So we reaffirmed our commitment and the actions we were 
taking on that front, as well as to encourage more laboratory-
directed research and development and work for all those 
activities.
    On the particular point you raised, what we have decided to 
do, working together with our laboratories, we meet on a 
regular basis. I think it comes down to probably three core 
things. One is the directives, the DOE directives and the 
directives we as Federal employees need in order to manage our 
contracts and make sure that the taxpayer gets what it needs. 
The second is trust, to build and maintain a level of trust 
between our organizations. The third is a level and a 
consistency in governance.
    On the directives side, DOE and NNSA have separately, but 
it overlaps, taken a strong look at directives. If I could just 
give one example, in security, if one takes a look at the 
security budget request over the last 3 years, our security 
request has gone down significantly, over 10 percent in our 
security area. That's due to the fact that we've simplified, 
clarified our security directives. That's allowed us to save, 
essentially reduced our security request from $718 million to 
$643 million from fiscal year 2010 to 2011.
    That savings, that difference of over $60, $70 million, is 
going right back to doing the scientific and programmatic work 
that we need to do. Are we going to stop there? We're going to 
continue on, because there's more we can do on cleaning up and 
simplifying our directives.
    On the trust area, we have our laboratory directors. I meet 
with our laboratory directors on the phone every week. No 
substitutes allowed. We can't have the deputy or the deputy of 
the deputy or someone down the line. It's a personal phone 
call. We have monthly video calls with the laboratory 
directors, as well as the whole enterprise together, both the 
Federal and contractor team together, to work out these 
problems.
    We recognize we have a lot more to do on the governance 
side. On the governance side, we've taken action and as 
recently as within the past 12 months, to drive efficiencies by 
consolidating our contracts between Y12 and Pantex. We've now 
established a single site office, Federal site office. Instead 
of having two offices, one in Texas and one in Tennessee, we 
have an integrated office so that there's no question about a 
consistent set of documents and guidance and directives that 
are coming out. It makes it easier to ensure that the things 
that we talk about, my Principal Deputy Administrator, Ms. 
Neile L. Miller, on pushing forward the concept of integrating 
as one organization, making sure that actually gets to the 
contracting officer that has a day-to-day impact on our 
particular laboratory.
    The final point--and I recognize time is limited--is that 
we've taken a look and we've brought on board--Admiral Donald 
was kind enough to allow one of his star performers, Michael 
Lemke, to come into, report directly to me, and take a look at 
all of our sites and drive consistency in how our Federal site 
offices are run, organized, and how they interface with their 
functional heads.
    Previously the site office work was reporting within the 
weapons program itself, and that provides--that makes it a 
little bit more difficult for us to drive consistency on 
functional operations, like human resources, procurement, and 
contracting. Those types of activities drive costs into our 
laboratories and plants, and that's a piece that we think is 
very ripe for helping out on.
    Senator Nelson. Thank you.
    Senator Sessions.
    Senator Sessions. Mr. D'Agostino, I respect you and know 
that you're committed to doing the right thing.
    Mr. D'Agostino. Yes, sir.
    Senator Sessions. I'm pushing you to be aggressive in 
making progress. But I think you remember the debate over the 
START Treaty, and my colleague Senator Kyl, with whom I worked 
very closely, ranking Republican, he was one of the more active 
members of that entire effort. He feels that the agreement that 
was made in exchange for certain decisions about the START 
treaty has been breached and it has not been honored by this 
budget.
    It seems to me plain that that's correct. Am I wrong? Is 
there another way to look at that?
    Mr. D'Agostino. I think there's another way to look at it. 
I greatly appreciate Senator Kyl's commitment to this mission 
area.
    Senator Sessions. He's leaving the Senate and his belief is 
that one of the critical issues facing America is to get out of 
this ``we're not going to do anything about nuclear weapons, 
they're all going to go away one day and we don't have to 
invest any more money in it,'' and we have to do what experts 
have all told us, modernize the weapons systems.
    You agree that's a good goal, I trust?
    Mr. D'Agostino. Absolutely.
    Senator Sessions. That's why it was such a big issue. This 
was not a little matter. The wording of the thing was discussed 
with the White House in depth.
    So I'm asking you, does not this budget break faith with 
that commitment?
    Mr. D'Agostino. It does not break faith with that 
commitment. The President has committed and if the fiscal year 
2013 budget is authorized and appropriated as proposed there 
will be a 20 percent increase in essentially a 2-year period of 
time, or a 3-year period of time, to our program. This is a 
significant increase by any measure in a very complicated area.
    Senator Sessions. I'm not saying did you have an increase 
or not. I'm asking if it met the agreement that was entered 
into at that time.
    Mr. D'Agostino. It met the agreement in order to take care 
of the stockpile and recapitalize our enterprise. We have, of 
course, as we've discussed, deferred the plutonium facility for 
the reasons that I've identified, and that is a prudent risk 
management approach, given that the laboratory directors and I 
had actually talked about this before the budget was released, 
that if faced with challenges the priority is work actually on 
the stockpile itself. That is why we're going forward with the 
fiscal year 2013 budget as proposed.
    Senator Sessions. I'm going to look at the numbers. It 
won't be long, we'll figure out who is correct about that.
    Mr. D'Agostino. Yes, sir.
    Senator Sessions. It's not going to be words. We have real 
numbers on this situation.
    Mr. Chairman, we have other witnesses coming. I won't 
utilize any more time. I do think it's important that Energy 
and Defense be more in sync here. I've had a fundamental 
concern that Energy's focus is too disconnected from the 
interests of the Nation in getting the system. To me, we don't 
have a real good, clear chain of command and interest that 
would help us.
    I think these laboratories have provided fabulous service 
to America that has kept us in the forefront of the world. But 
when any institution ages over these many years, not only the 
building but the whole institutions and bureaucracies, 
frequently larger and larger numbers of people and efforts get 
spent on things that are not as critical as they might be. If 
you're in a competitive business environment, you go out of 
business if that's so. Sometimes in Washington, when you're not 
performing up to schedule you ask Washington for more money.
    I don't know what the situation is. But it's really 
important. Thank you, Mr. Chairman, for letting us discuss it.
    Senator Nelson. Thank you, Senator.
    In that regard, I think there is a continuing question 
about the independent role of NNSA as it might relate to DOE, 
because when Congress created NNSA in 1999, a principal concern 
at that time was to create a ``semi-autonomous agency'' that 
was free from the larger elements of DOE, so that it could 
focus on its core defense-related missions. In fact, if you 
read the first sentence of the statute it says: ``There is 
established within the Department of Energy a separately-
organized agency to be known as the National Nuclear Security 
Administration.'' That's exactly what it says.
    Can you provide the subcommittee, say maybe within the next 
30 days, some legislative suggestions or technical drafting 
assistance on how NNSA can still report to the Secretary of 
Energy, but be more independent of the rest of DOE? Because I 
think it was supposed to be on the organizational chart out 
here [indicating], not down here [indicating]. That's how it's 
been explained to me.
    It's probably just similar to the Federal Energy Regulatory 
Commission as it has a separate independent, semi-autonomous 
relationship. Could you give us some ideas of that, and then 
provide us with something if you agree?
    [The information referred to follows:]

    The legislative decision raised in your question is clearly within 
the congressional prerogative. Although we are committed to assisting 
Congress in legislative endeavors, there has not been sufficient time 
to provide the appropriate analysis and support for your request at 
this time. We will keep you apprised as we review all the potential 
alternatives and impacts that are identified.

    Mr. D'Agostino. Mr. Chairman, we'd be glad to work with the 
subcommittee in any way possible to make sure that we 
accomplish the objectives of the NNSA Act and consistent with 
DOE.
    I do want to say that we are a part of DOE. We absolutely 
depend on DOE, the broader DOE technical infrastructure in 
order to get our job done, whether it's our NNSA job or not. We 
are an integrated part of DOE. They need us; we need them.
    The key, of course, is making sure that we have the right 
balance on governance----
    Senator Nelson. Yes.
    Mr. D'Agostino. The Secretary--I talked to him today, as a 
matter of fact, on this topic, because I knew it was important. 
The question of governance has come up a number of times in the 
press and now in the hearing today, sir, with both of you. The 
Secretary, first of all, told me that he's committed to 
continuing to move forward. I could provide to the subcommittee 
details on where we have moved forward in many areas and what 
we're planning on doing out in the future. So I'd be happy to 
work with you, sir.
    Senator Nelson. Thank you.
    Perhaps to put it a little bit differently, I know that you 
have a certain integration for the mutual responsibilities for 
your support with DOE, but Walter Mondale once commented that 
working from his office in the Old Executive Office Building, 
that: ``You might as well be in Baltimore.'' That speaks 
volumes about location in this busy town.
    I don't want to say that we ought to move your office 
necessarily, but there is something to be said about a 
disconnect that comes from different locations. Sometimes it's 
very positive; sometimes it's very negative. I don't think you 
have to answer that question. I just throw it out as an idea 
for consideration.
    Senator Sessions. Mr. D'Agostino, looking at the numbers on 
the written testimony I have, I think these are official 
numbers, we were projected to have an appropriation for total 
weapons of $7.9 billion this year. It's going to be $7.5 
billion; is that correct?
    Mr. D'Agostino. Yes, sir, about $7.5 billion.
    Senator Sessions. This is an inauspicious start, would you 
not agree? Next year was projected to go to $8.4 billion, the 
next year $8.7, the next year $8.9, $9, $9.3, $9.6, $9.8, and 
$10.1 over the 10 years.
    So I guess what I'm saying to you, if we're going to have 
this much of a miss in really the first year of our new 
agreement, I thought, to modernize our weapons, aren't we 
facing inevitably a failure to be able to complete what we've 
committed to do?
    Mr. D'Agostino. Senator Sessions, this is our third year of 
increases that we're asking for in this program. We've 
essentially received 10 percent increase the first year. We 
asked for a 10 percent increase the second year, did not get 
that 10 percent increase. We only got a 5 percent increase the 
second year. On top of that, we have the BCA amendment lid on 
top of it.
    So as a result of that environment, we made adjustments. 
Remember, the fiscal year 2012 budget that was appropriated was 
not what we had asked for. It was over $400 million less, and 
as a result we received $7 billion. There were reasons for 
that. I'm not going to second-guess, tell Congress how to do 
authorizations and appropriations. I'm on the executive branch. 
I'm going to execute the program that's authorized and 
appropriated, and, in fact, that's what we're doing.
    You have to use fiscal year 2012 as our jumping off point 
in order to put together the right program in the out-years.
    Senator Sessions. Looking at under the blue line at the 
bottom of this chart, it says 2012, $7.6 billion; 2013, it 
looks like we're coming in at $7.5. Why isn't that a decline? 
Help me on that? You didn't meet the $7.6 last year, either. So 
you missed the $7.6 last year, is that the answer?
    Mr. D'Agostino. In fiscal year 2011, there was a year-long 
Continuing Resolution in the works. We received an anomaly for 
the weapons activities account that would allow us to get the 
full amount consistent with the President's promises. Congress 
gave us the anomaly, which was very much appreciated.
    In fiscal year 2012 we asked for a very significant 
increase in this program and we did not get it. The increase in 
the program was to do a broad scope of work and assumed 
increases into the out-years. That, of course, was done in a 
different fiscal environment, and now we have a good handle on 
the kind of workload that's important to DOD and important to 
what we need to get done. That is why we've asked for this 
essentially close to a 5 percent increase overall for NNSA, and 
I think actually it's separating out the Defense Programs 
piece, it might even be closer to 7 percent increase for the 
Defense Programs piece.
    So it's a very strong request and a strong commitment to 
nuclear security, and particularly working on the stockpile.
    Senator Sessions. It seems like the numbers just are not 
coming in to meet the requirement, and that's the whole concern 
I have.
    Mr. D'Agostino. Yes, sir.
    Senator Sessions. We don't want to just smooth it over and 
say we can delay this or delay that. Pretty soon you just don't 
have the money to complete the mission you've been given, and 
I'm afraid that's where we are, which is contrary to what we 
thought we had agreed to after much discussion last year.
    Maybe we'll pursue it and we'll submit you some questions 
for the record.
    Mr. D'Agostino. Senator, we're glad to take those.
    Senator Nelson. You must feel like this: that we gave you 
$400 million less than you needed and now we're criticizing you 
for having $400 million less to deal with.
    Mr. D'Agostino. Something like that, sir.
    Senator Nelson. Something like that, I understand.
    Senator Sessions. You need to say that. You need to say: 
``You guys are not giving me enough money to meet the mission 
you gave me to meet.'' If you won't say that then it's hard for 
us to help.
    Senator Nelson. Yes, because I was very uncomfortable 
seeing that $400 million disappear, with the representations 
that we've made to be fully funded to carry out the program. So 
my discomfort continues, and I commend you for trying to find 
ways to do the same amount that you needed to do in a different 
way with less. We're all faced with that. We just don't want to 
be critical. What we want to know is as some things slip, will 
the mission slip? If you tell us no, the mission is not going 
to slip, even though you may defer some things, then I perhaps 
would feel better.
    But I would have felt a lot more at ease with the $400 
million being in your budget to do it the way we were initially 
representing to others that we were going to do it.
    Mr. D'Agostino. Thank you, Mr. Chairman.
    Senator Nelson. Thank you. You are excused, Mr. D'Agostino, 
so we can call forward the next panel of witnesses, thank you 
again. [Pause.]
    On the second panel we have the Honorable Donald L. Cook, 
Deputy Administrator for Defense Programs at the NNSA; Admiral 
Kirkland H. Donald, USN, Deputy Administrator for Naval 
Reactors and Director of Naval Nuclear Propulsion at the NNSA; 
and Mr. David G. Huizenga, Senior Advisor for EM at the Office 
of EM at DOE; all from DOE. We appreciate your being here.
    ``Hie-ZEN-ga.'' I'll get it right one of these days. I may 
just call you ``Doctor H,'' I don't know.
    Mr. Huizenga. That will be fine, sir.
    Senator Nelson. Let's see. Would you like to make some 
brief opening statements? I know you have statements for the 
record, but please, if you would, why don't we start with you, 
Admiral Donald, and move in that direction.

STATEMENT OF ADM KIRKLAND H. DONALD, USN, DEPUTY ADMINISTRATOR 
  FOR NAVAL REACTORS AND DIRECTOR, NAVAL NUCLEAR PROPULSION, 
 NATIONAL NUCLEAR SECURITY ADMINISTRATION, DEPARTMENT OF ENERGY

    Admiral Donald. Mr. Chairman, thank you very much, and 
Ranking Member Sessions. I do have an opening statement I would 
like to make if that's suitable to you. I appreciate the 
opportunity to testify before you today on the Naval Reactors 
fiscal year 2013 budget request. Our budget request is for $1.1 
billion and this funding provides the resources required for 
the day-to-day work associated with the safe and reliable 
operation of 104 naval nuclear propulsion plants, plants which 
provide power to more than 40 percent of the U.S. Navy's major 
combatants.
    The fiscal year 2013 budget also supports the President's 
national security strategy with the continued development of 
the Ohio-class replacement submarine and stewardship of our 
naval nuclear infrastructure. DOD has decided to delay the 
Ohio-class replacement by 2 years. The Naval Reactors fiscal 
year 2013 request reflects that shift and supports the Navy's 
revised shipbuilding schedule, while ensuring the continuity of 
a sea-based strategic deterrent.
    The budget further provides funding for the land-based 
prototype refueling overhaul, a critical aspect of the 
development of a life-of-the-ship core for the Ohio-class 
replacement. Core manufacturing, development, and demonstration 
for a life-of-the-ship core will be performed as a part of this 
project. By constructing the replacement core for the prototype 
with the technologies we plan to use for Ohio-class 
replacement, we will mitigate technical, cost, and schedule 
risks associated with that ship construction program.
    Finally, resources are requested for the recapitalization 
of the aging spent nuclear fuel handling facility at the Naval 
Reactors Facility in Idaho. As you may recall from previous 
testimony, we must remain in compliance with the 1995 Idaho 
settlement agreement for movement of our fuel from wet storage 
to dry storage and ultimately for disposal. While working to 
meet this commitment to the people of Idaho, that aging 
infrastructure must also support the demands of a challenging 
refueling schedule for our nuclear-powered fleet, specifically 
our Nimitz-class aircraft carriers.
    Mr. Chairman, the Naval Reactors budget for fiscal year 
2013 is consistent with the goals set out in the BCA of 2011. 
However, as Mr. D'Agostino has pointed out, the out-years with 
the placeholder numbers between fiscal years 2014 and 2017 is 
less than Naval Reactors' validated requirements and is subject 
to review between DOE and the Navy.
    Within these constraints, my first priority must be to 
safely sustain the Naval Reactors fleet support and regulatory 
oversight mission within our baseline funding, followed by 
continued progress on these major projects. Within the BCA 
funding constraints in the out-years, I cannot deliver the very 
important projects and maintain the proven standards of 
oversight and technical support that will continue to ensure 
nuclear fleet safety and effectiveness. Given the vital 
importance of our nuclear ships, the growing challenges of both 
the high operational tempo and an aging fleet, and the grave 
consequences of even the perception of eroding day-to-day 
standards and support, I must apply my resources, as available, 
to sustaining today's nuclear fleet. This prevents me from 
progressing on the new projects absent some additional funding 
to be addressed in the out-years.
    As a result, the fiscal year 2013 budget will maintain the 
land-based prototype refueling overhaul to be executed in 2018. 
The fiscal year 2013 request will support reactor design for 
the Ohio-class replacement on the DOD revised schedule, but it 
will not support the recapitalization of the spent fuel 
handling infrastructure in time to support the existing plan 
for refueling of CVN-73, USS George Washington.
    We're currently reviewing options as work-arounds, but all 
options will include some additional cost and risk. I will keep 
this subcommittee apprised of that analysis.
    In addition, I'm further forced to consider deferral of 
maintenance of facilities work, decontamination, and 
decommissionings across our infrastructure. But I understand 
the impacts of those and we judge those to be prudent risks to 
be taking at this time.
    I recognize that we've come before you today in a time of 
daunting fiscal constraints, constraints we haven't seen in 
decades. Prior to initiating the new projects in 2010, I 
embarked on a large-scale strategic alignment of funding as 
well as significant initiatives to streamline our support 
infrastructure and gain cost savings and efficiencies, such as 
combining the maintenance, management, and operations contracts 
for our two laboratories.
    I respectfully ask that you consider the contributions our 
program makes every day to national security and will be 
required to make well into the future to meet our strategic 
objectives.
    I would like to point out before I close one important 
milestone for Naval Reactors and for the Nation. This year 
marks the final deployment of the world's first nuclear-powered 
aircraft carrier, USS Enterprise. Commissioned in 1961, 
Enterprise has deployed for the last time as of Sunday. No 
other ship better illustrates the successes and evolutions of 
the nuclear-powered Navy like the Enterprise. She has served us 
well since 1961. After her final deployment, she'll commence 
her inactivation in November 2012.
    Chairman Nelson, pending your retirement and the completion 
of my term as the Director of Naval Reactors later this year, 
this will likely be the last time that I will testify before 
you, and I thank you. It's been an honor to work with you and I 
thank you for all that you've done for my program and for the 
U.S. Navy.
    My written statement has been submitted for the record and 
I look forward to responding to any questions that you may 
have.
    [The prepared statement of Admiral Donald follows:]
           Prepared Statement by ADM Kirkland H. Donald, USN
    The request for this appropriation is $1.089 billion; an increase 
of almost 1 percent over the fiscal year 2012 appropriation. The 
program directly supports all aspects of the U.S. Navy's nuclear fleet, 
which encompasses the Navy's submarines and aircraft carriers, over 40 
percent of the U.S. Navy's major combatants. Currently, the nuclear 
fleet is comprised of 54 attack submarines, 14 ballistic missile 
submarines, 4 guided missile submarines, and 11 aircraft carriers. Over 
8300 nuclear-trained Navy personnel safely operate the propulsion 
plants on these ships all over the world, and their consistent forward 
presence protects our national interests. At any given time, about half 
of these ships are at sea.
    2011 was a successful year for Naval Reactors. The nuclear-powered 
fleet surpassed 148 million cumulative miles safely steamed, providing 
the Navy with a consistent forward presence, capable of rapid response 
to emerging world events. The endurance, forward-presence, and instant 
readiness enabled by nuclear propulsion plants were on full display 
during Operation Odyssey Dawn, with deployed submarines launching over 
half of the initial salvo of cruise missiles, just one of this year's 
57 submarine missions of significance to national security. Naval 
Reactors has also surpassed important milestones in the Ohio 
Replacement reactor design, including sufficient completion of design 
and manufacturing development of core materials to support the 2012 
core materials decision. In Idaho, the Program loaded its 50th spent 
fuel dry storage canister, with a third of the Navy's current spent 
fuel inventory now ready for shipment to a permanent repository. 
Finally, as highlighted by the commissioning of the USS California (SSN 
781) and the christening of the PCU Mississippi (SSN 782), Virginia-
class submarines are consistently delivered under-budget and ahead of 
schedule. Throughout all these significant efforts, Naval Reactors also 
contributed to the relief in response to the tragic earthquake, tsunami 
and resultant events at the Fukushima Dai-ichi nuclear power plant in 
Japan.
    Continued safe and reliable Naval nuclear propulsion requires that 
Naval Reactors maintains the capability to anticipate and respond to 
small problems before they become larger. The technical base and 
laboratory infrastructure allows thorough and quick evaluation of 
technical issues that arise from design, manufacture, operation and 
maintenance with technically-sound dispositions, ensuring crew and 
public safety without unnecessarily restricting the important missions 
of our nuclear powered-ships. Through careful collection and meticulous 
technical analysis of fleet operational and inspection data, and 
rigorously engineered designs, as well as prudent maintenance and 
modernization, the Program maintains a record of over 60 years of safe 
and effective operations. Uncompromising and timely support of the 
nuclear fleet continues to be the highest priority for Naval Reactors. 
This focus will prove even more important as the nuclear fleet, whose 
oldest ship, USS Enterprise (CVN 65), recently celebrated her 50th 
birthday, continues to increase its average age. Day-to-day activities 
include oversight and operation of two laboratories across multiple 
sites, including a prototype site with two operating reactor plants, 
and a spent nuclear fuel processing and handling facility. This budget 
funds all required facilities, maintenance, capital equipment, 
compliance, and remediation for these facilities. The work at these 
facilities enables complete lifecycle support for every nuclear-powered 
warship, from construction through inactivation. Technical work is 
conducted in areas such as structural mechanics, electrical 
engineering, nuclear engineering, materials science, reactor servicing, 
chemistry, and spent fuel management.
    In addition to fleet support, Naval Reactors has embarked on 
important new projects: namely, the refueling overhaul for the S8G 
Land-based Prototype reactor, the design of the Ohio Replacement 
reactor plant, and recapitalization of our naval spent nuclear fuel 
infrastructure. Each of the projects is critical to fulfillment of the 
Navy's longer term needs.
    The Budget Control Act of 2011 established discretionary caps, 
which are delaying several of the administration's nuclear 
modernization initiatives. Of the three new projects, only the S8G 
Land-based Prototype Refueling Overhaul remains on the originally 
envisioned schedule that was presented to Congress last year. The 
Prototype reactor plant has served Naval Reactors' needs for research, 
development, and training since 1978, and the reactor provides a cost-
effective testing platform for new technologies and components before 
they are introduced to the Fleet. Equally important, it provides an 
essential, hands-on training platform for the fleet's reactor plant 
operators, every one of whom qualifies on an operating reactor before 
their assignment to a submarine or aircraft carrier. To continue vital 
research capabilities, as well as train sufficient operators to man the 
Fleet, the S8G Land-based Prototype Refueling Overhaul must begin in 
2018. This budget fully funds the fiscal year 2013 effort required for 
the upcoming refueling overhaul of the S8G Land-based Prototype. The 
new prototype reactor core work will be used to test the 
manufacturability of new core materials required for the Ohio 
Replacement submarine.
    The Ohio Replacement reactor plant design continues and the fiscal 
year 2013 requested amount supports continuing this work to meet the 
Navy's revised schedule and procurement of reactor plant components in 
2019 (to support a 2021 lead-ship procurement). This represents a 2-
year delay compared to the schedule presented to Congress last year, 
which the Navy considers the best balance between BCA constraints and 
operational risk. The current Ohio-class ballistic missile submarines 
are reaching the end of their operational life and will begin to retire 
in 2027. Naval Reactors is designing and developing a life-of-ship core 
to ensure continuous and credible strategic deterrence, as well as 
enable substantial cost savings. The planned life-of-ship core will 
have a longer reactor life than any previous core, and will eliminate 
the need for a mid-life refueling, enabling the Navy to reduce 
maintenance requirements by shortening the mid-life overhaul. This 
increased SSBN operational availability will reduce strategic 
deterrence submarine procurements by two. Full funding for this program 
is crucial to support designing, building, and testing of systems for a 
new design of a nuclear reactor plant on the identified schedule. 
Completion of this work drives the overall design maturity of the 
reactor plant, which, as demonstrated by the successful construction of 
Virginia-class submarines, is vital to minimizing risk and cost during 
component procurement and ship construction. The request is sufficient 
for Ohio Replacement development through fiscal year 2013 and we are 
working with DOD to address the out-years.
    Finally, the Spent Fuel Handling Recapitalization Project is needed 
to maintain the capability to manage naval spent nuclear fuel in a 
cost-effective way that does not impede the refueling of active ships 
and their return to operations. This project includes receipt, 
inspection, processing, packaging, and secure dry storage. The existing 
facility is more than 50 years old, and was never designed for its 
current primary mission of packaging naval spent nuclear fuel for 
permanent dry storage. Although the current Expended Core Facility 
continues to be maintained and operated in a safe and environmentally 
responsible manner, it no longer efficiently supports the nuclear 
Fleet. Uninterrupted receipt of naval spent nuclear fuel is vital to 
the timely refueling and return of warships to full operational status. 
Due to the fiscal constraints of the Budget Control Act, Naval Reactors 
is reviewing the schedule for the SFHP and developing a revised 
profile. Delays past 2020 will require the procurement of additional M-
290 shipping containers to store CVN fuel until it can be unloaded at a 
new facility. These additional containers will be procured using 
Department of the Navy funds at an estimated cost of $200 million.

    Senator Nelson. Thank you, Admiral.
    Senator Sessions has a 4 o'clock that he has to take, and 
so he has a question. We'll just go out of order and we can 
wait.
    Senator Sessions. Thank you very, very much, Mr. Chairman.
    Mr. Huizenga, the request for the fiscal year 2013 for EM 
is $5.49 billion. That is almost $500 million more than the 
level appropriated in fiscal year 2012. You and I briefly 
discussed it before. You indicated it was not an increase, but 
it seems to be delineated on page 377 of your DOE budget 
manual, and that money is for a defense environmental cleanup 
contribution program.
    Given the EM funding is part of the security spending, how 
do you justify that large an increase for EM while we're 
getting a $371 million reduction from Dr. Cook from the funding 
level that was planned for fiscal year 2013 for the weapons 
program? It appears to me that the national security 
requirements of weapons modernization has been reduced in favor 
of additional money in environmental cleanup; is that correct? 
If you'd like to answer for the record, you could do that. If 
you have a brief response to that now, I'd be glad to take it.
    [The information referred to follows:]

    The fiscal year 2013 request for the defense environmental cleanup 
account is $5.49 billion. This amount includes the $463 million that 
would be transferred from the General Fund to be deposited into the 
Uranium Enrichment Decontamination and Decommissioning Fund--netting to 
zero in the request. There is no programmatic increase of $463 million. 
The total fiscal year 2013 request for the Environmental Management 
program is $5.65 billion, which is a reduction of $60 million from the 
fiscal year 2012 enacted level of $5.71 billion.

    Mr. Huizenga. Sir, thank you for bringing that up. I think 
maybe I misunderstood before. Our overall request of $5.65 
billion this year is down about 1 percent, or just a little bit 
more than 1 percent, from the request from last year. That's 
what I was referring to in our previous conversation.
    I think that with the overall constraints that we do find 
ourselves in this year, we believe that our request will allow 
us to meet our compliance agreements and commitments to the 
citizens around these facilities that supported us in the Cold 
War efforts, and we think it's a responsible request, sir.
    Senator Sessions. I'll be glad to examine it and I may 
follow up with a more detailed question.
    Thank you, Mr. Chairman. It's been an excellent hearing.
    Admiral Donald, thank you for your work and your 
patriotism, all of you. All of those associated with the labs 
have done really great work. But it just may be in this point 
in history that it's time for a rigorous reevaluation of the 
massive amounts of monies that are being handled. Maybe some of 
the bureaucracies need to be realigned and people reorganized 
and we could get more production and maybe save some money at 
the same time.
    Thank you, Mr. Chairman.
    Senator Nelson. Thank you, Senator. I appreciate it.
    Dr. Cook.

  STATEMENT OF HON. DONALD L. COOK, DEPUTY ADMINISTRATOR FOR 
  DEFENSE PROGRAMS, NATIONAL NUCLEAR SECURITY ADMINISTRATION, 
                      DEPARTMENT OF ENERGY

    Dr. Cook. Chairman Nelson and Ranking Member Sessions, good 
afternoon. I want to thank you for the opportunity to come here 
to testify before you on the President's fiscal year 2013 
budget request.
    The fiscal year 2013 budget request provides $7.57 billion 
for weapons activities. That's an increase of 5 percent. Within 
that, the amount for Defense Programs is $6.23 billion. That's 
an increase of $420 million in fiscal year 2013. NNSA has the 
responsibility to maintain a safe, secure, and reliable nuclear 
weapons stockpile to help ensure the security of the United 
States and of its allies, to deter aggression, and to support 
international stability.
    Maintaining a safe, secure, and reliable stockpile 
necessitates continuing progress in mission-essential sciences 
to achieve accurate health and status assessments of our aging 
nuclear weapons systems. Over the last decade, NNSA has been 
devoted to filling this need.
    The $17 million increase in this year's budget request for 
science campaigns further demonstrates the administration's 
support. The science and the experimental tools developed by 
Defense Programs allow our scientists, our technicians, and 
engineers to perform the needed assessments of the weapons 
systems and the components within to ensure that the effects of 
aging have not deteriorated the desired performance levels and 
to guarantee the safety, the security, and the reliability of 
these systems without having to resort to a new underground 
nuclear weapons test.
    I should note that September 2012 will mark the 20th 
consecutive year in which we have not required a nuclear test 
in order to ensure the safety, the security, and the 
reliability of our weapons stockpile. The Stockpile Stewardship 
Program is working.
    As these systems, designed in the 1960s and 1970s, continue 
to age, life extension activities are required to preserve the 
established safety, security, and reliability thresholds. The 
fiscal year 2013 budget request includes a $214 million 
increase to the directed stockpile work that supports the W76, 
B61, W78, and W88 LEPs.
    We've worked diligently with DOD and the NWC in crafting 
the programmatic schedule that is necessary to meet the NWC's 
requirements established for these systems. The B61 is a 
critical component of the U.S. strategic and of the extended 
nuclear deterrent. The current system is among the oldest in 
the stockpile. It has key non-nuclear components that are 
reaching their end-of-life and in need of replacement. The B61 
LEP will allow consolidation of four variants into a single 
version of the B61 bomb, allowing NNSA and DOD to save on long-
term sustainment costs, enable future stockpile reductions, 
ensure safety, and reduce the amount of special nuclear 
material used. The NWC has endorsed entry of the B61 LEP into 
phase 6.3, the engineering development phase.
    Defense Programs is also charged with maintaining and 
replacing the infrastructure that provides the foundation and 
basis of the nuclear security enterprise. Some of the 
facilities have survived beyond their lifespan and are in dire 
need of replacement. The efforts and activities executed within 
Defense Programs are vital to the Nation's nuclear deterrent 
and in order for this critical work to continue we have to have 
both a safe and a secure operational environment.
    The President's budget request includes an increase of $179 
million in fiscal year 2013, enabling accelerated construction 
of the UPF at Y12. The completion of this facility will allow 
our personnel to vacate Building 9212 at Y12, which has already 
endured 63 years of operational use and it poses one of the 
highest programmatic and operational risks across the nuclear 
enterprise should it fail. NNSA has determined that an 
acceleration of the UPF at Y12 is required to ensure continuity 
of our sole uranium manufacturing capability.
    We're also working with the General Services Administration 
on completing the construction of the Kansas City Responsive 
Infrastructure Manufacturing and Sourcing Campus. We will begin 
transitioning to the new facilities in 2013. We will complete 
the transition in 2014.
    We'll also finish the construction of the High Explosive 
Pressing Facility at Pantex in fiscal year 2017. That's 
designed to support the LEPs. We will start construction as 
well of the Transuranic Waste Facility Phase B at Los Alamos. 
The Resource Conservation Recovery Act permit modification 
approval is expected by the State of New Mexico still in fiscal 
year 2012.
    With all that said, however, under the BCA we now face new 
fiscal realities. Adding to this fiscal challenge is the fact 
that the funds appropriated to the NNSA weapons activities in 
fiscal year 2012 were $416 million less than the President's 
request and that forced us to make tough decisions on which 
projects can or cannot be executed at this time.
    In light of these actions, we've been compelled to deviate 
from our previous strategy and to modify our programmatic 
schedule to meet the Nation's immediate military requirements. 
Through coordination with DOD and the NWC, we have selected a 
path forward within the Nation's budgetary limitations. One of 
the decisions selected is the deferral for at least 5 years of 
the CMRR Nuclear Facility (CMRRNF) Project planned for Los 
Alamos National Lab. Deferring the CMRRNF will create an 
estimated $1.3 billion in cost avoidance over the next 5 years, 
permitting the funding of the most critical programs and 
capabilities, such as the weapons LEPs I've already mentioned 
and an accelerated UPF construction profile.
    We will continue to maintain our plutonium capabilities by 
utilizing facilities at Los Alamos, such as the PF4, Plutonium 
Facility No. 4, and a part of the CMRR project already 
constructed, that is the radiological lab and utility office 
building. That building, incidentally, has been completed ahead 
of schedule and under budget.
    In agreement with the NWC, we have delayed the first 
production unit of the B61-12 gravity bomb to 2019, but we will 
still meet the military requirements of the Nation. Despite the 
tough decisions made, we remain resolute in meeting the 
Nation's operational requirements, and we intend to remain 
vigilant in our mission to ensure the safety, security, and 
reliability of the Nation's nuclear weapons stockpile.
    Lastly, we recognize that a critical element of our 
enduring mission is the need to maintain healthy relationships 
between the national labs, the production plants, the Federal 
site offices, and headquarters. We're implementing governance 
and oversight transformations in order to streamline how NNSA 
will do business, reduce the cost of operations, and increase 
productivity, and we will strive to maximize mission 
performance while maintaining or enhancing overall safety and 
security of the nuclear security enterprise.
    I want to thank you again for the opportunity. I'll look 
forward to answering questions.
    Senator Nelson. Thank you.
    I'm going to try to get it right: Mr. Huizenga.
    Mr. Huizenga. Excellent, sir. It's a good Dutch name and 
you got it just right.
    Senator Nelson. Thank you.

      STATEMENT OF DAVID G. HUIZENGA, SENIOR ADVISOR FOR 
 ENVIRONMENTAL MANAGEMENT, OFFICE OF ENVIRONMENTAL MANAGEMENT, 
                      DEPARTMENT OF ENERGY

    Mr. Huizenga. Chairman Nelson, I'm honored to be here today 
to discuss the positive things that we are doing for the Nation 
through our ongoing efforts of the EM program. Our request of 
$5.65 billion enables the Office of EM to continue the safe 
cleanup of the environmental legacy brought about from 5 
decades of nuclear weapons development and government-sponsored 
nuclear energy research. Our cleanup priorities are based on 
risk and our continuing efforts to meet our regulatory 
compliance commitments. Completing cleanup promotes the 
economic vitality of the communities surrounding our sites and 
enables other crucial DOE missions to continue. By reducing the 
cleanup footprint, we are lowering the cost of security and 
other overhead activities that would otherwise continue for 
years to come.
    In August 2011, the Office of EM was aligned under the 
Office of the Under Secretary for Nuclear Security, as was 
pointed out by Under Secretary D'Agostino earlier this 
afternoon. This realignment promotes the natural synergies that 
exist between EM and NNSA. For example, at the Oak Ridge 
National Laboratory we're working with NNSA to accelerate the 
transfer of certain components of uranium-233 inventory. This 
inventory is valuable for national security applications and 
supports NNSA's missions related to safety, nuclear emergency 
response, special nuclear material measurement, and detection. 
This initiative will result in cost savings for EM and enable 
us to move forward on a cleanup of nuclear facilities in the 
heart of the Oak Ridge National Lab.
    Over the years the Office of EM has made significant 
progress in accelerating environmental cleanup across the 
departmental complex. For example, last December at the Defense 
Waste Processing Facility at our Savannah River Site in South 
Carolina, we solidified a record 37 canisters of highly 
radioactive waste, marking the most canisters filled in 1 month 
in the facility's 15-year history. Out west, at the Moab site 
in Utah, we celebrated the removal of 5 million tons of uranium 
tailings from the site to a safe location away from the 
Colorado River. Through 2011, we safely conducted over 10,000 
shipments of transuranic waste to the WIPP in New Mexico, the 
world's largest operating deep geologic repository. As you can 
see from these accomplishments, the Office of EM has made great 
progress and will continue to do so with your help.
    We could not have achieved such notable accomplishments 
without an outstanding Federal and contractor workforce. The 
safety of our workers is a core value that is incorporated into 
every aspect of our program. We've maintained a strong safety 
record and continuously strive for an accident-free and 
incident-free workplace. We seek to continue improvements in 
the area of safety by instituting corrective actions and by 
aggressively promoting lessons learned across our sites. In 
collaboration with DOE's Office of Health, Safety, and Security 
and our field sites, we're working to achieve a stronger safety 
culture within the program, thereby improving the safety of our 
construction and operations facilities.
    We will continue to identify opportunities to reduce the 
life cycle costs of our program, including the development of 
new technologies and other strategic investments. For example, 
in 2013 we will continue our efforts to develop technologies 
that allow for the segregation and stabilization of mercury-
contaminated debris and improve groundwater monitoring.
    We continue working with the Government Accountability 
Office to institutionalize improvements in contracting and 
project management. We have established project sponsors at 
headquarters for all of our capital asset projects and conduct 
regular peer reviews of our most complex projects. We are 
including U.S. Army Corps of Engineers personnel who have 
demonstrated experience in project and contract management on 
these project review teams. We are committed to becoming a 
best-in-class performer in this area.
    Chairman Nelson, we will continue to apply innovative 
cleanup strategies so that we can complete quality work safely, 
on schedule, and within cost, thereby demonstrating our value 
to the American taxpayers.
    Thank you, and I would be pleased, as the others, to answer 
any questions you may have.
    [The prepared statement of Mr. Huizenga follows:]
                Prepared Statement by David G. Huizenga
    Good afternoon, Mr. Chairman, Ranking Member Sessions, and Members 
of the Subcommittee. I am pleased to be here today to answer your 
questions on the President's fiscal year 2013 budget request for the 
Department of Energy's (DOE) Office of Environmental Management (EM). 
The EM fiscal year 2013 budget request of $5.65 billion enables EM to 
continue the safe cleanup of the environmental legacy brought about 
from 5 decades of nuclear weapons development and government-sponsored 
nuclear energy research.
 environmental management program strategies: a national responsibility
    The DOE Strategic Plan highlights EM's objective to complete the 
environmental remediation of our legacy and active sites by disposing 
of radioactive wastes, remediating contaminated soil and groundwater, 
and deactivating and decommissioning (D&D) radioactively contaminated 
facilities. EM is committed to sound technology development and 
deployment. EM develops and implements first-of-a-kind technologies to 
further enhance its ability and efficiency in cleaning up radioactive 
waste. Through these innovations, EM and the companies that perform its 
cleanup work have remained world leaders in this arena. Our work in EM 
enables other crucial DOE missions to continue across the United 
States. By reducing our cleanup footprint, EM is lowering the cost of 
security, surveillance, infrastructure, and overhead costs that would 
otherwise continue for years to come.
                     overview of program priorities
    To best address our cleanup objectives, EM's cleanup prioritization 
is based on achieving the greatest risk reduction benefit per 
radioactive content (wastes that contain the highest concentrations of 
radionuclides) while continuing to meet regulatory compliance 
commitments and promote best business practices. EM's priorities to 
support this approach include:

         Radioactive tank waste stabilization, treatment, and 
        disposal;
         Spent (used) nuclear fuel storage, receipt, and 
        disposition;
         Special nuclear materials consolidation, processing, 
        and disposition;
         Transuranic waste and mixed low-level/low-level waste 
        disposition;
         Soil and groundwater remediation; and
         Excess facilities D&D.
                      creating synergies that last
    In an effort to maximize the accomplishments of mission-critical 
projects and organize needs more closely with DOE's resources, EM was 
aligned under the Office of the Under Secretary for Nuclear Security in 
August 2011. This alignment allows DOE to capitalize on the expertise 
that exists among the National Nuclear Security Administration (NNSA), 
EM, the Office of Legacy Management, and the DOE Chief Nuclear Safety 
Officer on areas related to project management, nuclear materials and 
waste handling, and nuclear safety and security.
    There are natural synergies between EM and NNSA. At Savannah River 
Site, EM and NNSA are working closely together to utilize the H-Canyon 
facility and support multiple missions including: converting about 3.7 
metric tons of plutonium into suitable feed for NNSA's Mixed Oxide Fuel 
(MOX) Fabrication Facility; removing contaminants in the plutonium to 
make it amenable for use as MOX feed; and reducing the amount of 
plutonium that EM needs to package and send to the Waste Isolation 
Pilot Plant for disposal. These activities will occur in addition to 
EM's utilization of H-Canyon for activities such as the commencement of 
the process for the disposition of spent (used) nuclear fuel that is 
not suitable for extended storage in L-Basin.
    At Oak Ridge National Laboratory, EM and NNSA are working together 
to accelerate the transfer of certain components of the Uranium-233 
inventory that are valuable for national security applications. This 
cooperative effort will support NNSA's missions related to safety, 
nuclear emergency response, and special nuclear material measurement 
and detection. This initiative will result in cost savings for the EM 
program and enable EM to move forward on cleanup of nuclear facilities 
which will allow other DOE missions to continue. In addition, EM has 
established a partnership with NNSA to build upon the success of the 
Supply Chain Management Center, leveraging buying power across the 
combined EM and NNSA complexes for commonly used goods and services 
with the objective of realizing cost savings for the EM program similar 
to those NNSA has achieved.
                             safety culture
    The safety of EM workers is a core value that is incorporated into 
every aspect of the EM program. To best protect our workers, EM has a 
goal of zero accidents or incidents in the work place and to date, has 
maintained a strong safety record. EM continues to utilize the 
Integrated Safety Management System to ensure that all work activities 
are appropriately scoped, analyzed for hazards, comprehensively planned 
to eliminate or mitigate those hazards, and effectively performed by 
trained employees. In addition, EM follows DOE Order 226.1B, 
Implementation of Department of Energy Oversight Policy which instills 
the philosophy that line management is responsible for ensuring the 
safety when work is being performed. EM seeks to continue improvements 
in the area of safety by instituting corrective actions, promoting 
lessons learned, and developing new or improved processes.
    EM strives to promote and maintain a healthy safety culture at all 
of its sites. DOE defines safety culture as ``an organization's values 
and behaviors modeled by its leaders and internalized by its members, 
which serve to make safe performance of work the overriding priority to 
protect the workers, public, and the environment.'' As part of this 
effort, EM is working with DOE's Office of Health Safety and Security 
(HSS) and utilizing DOE's Implementation Plan for the Defense Nuclear 
Facilities Safety Board Recommendations 2011-1, Safety Culture at the 
Waste Treatment and Immobilization Plant to guide its actions and 
decisionmaking. As part of this effort, HSS has provided guidance and 
recommendations including how to better promote the raising of safety 
concerns on projects such as the Waste Treatment and Immobilization 
Plant. HSS will also conduct independent ``extent of condition 
reviews'' of major EM capital projects this year including the Sodium 
Bearing Waste Treatment Facility at Idaho and the Salt Waste Processing 
Facility at the Savannah River Site. In accordance with the 
Consolidated Appropriations Act Conference Report, fiscal year 2012, 
DOE, including EM and HSS, will conduct reviews of nuclear facility 
construction projects with a total project cost greater than $1 
billion, to determine if those projects are being managed in a way that 
could pressure contractors or Department managers to lessen nuclear 
safety in order to demonstrate acceptable project performance.
    To further instill a healthy safety culture in EM, within the next 
year, EM will conduct `town hall' style meetings at its sites with 
defense nuclear facilities. At these meetings, EM senior leadership 
will emphasize the importance of maintaining a strong safety culture 
and soliciting employee input regarding safety. EM will continue to 
keep its employees, the public, and the states where cleanup sites are 
located, safe from radioactive and hazardous materials contamination. 
EM will also further instill core values and principles that will allow 
for improved communication and team building in order to accomplish its 
mission goals.
                               compliance
    Over the last 22 years, EM has maintained a working relationship 
with regulators and developed agreements and compliance milestones that 
provide the framework and schedule for cleaning up the Cold War legacy 
at DOE sites. There are approximately 40 such agreements. In fiscal 
year 2011, EM met 97 percent of its enforceable agreement milestones. 
In light of the potential need to renegotiate some of the compliance 
milestones, EM's goal in fiscal year 2013 is to meet 100 percent of its 
compliance agreement milestones.
    The fiscal year 2013 EM budget request funds the closure of high 
level waste tanks 18 and 19 in the Savannah River Site F-Tank Farm. At 
Los Alamos National Laboratory, fiscal year 2013 funds expedite the 
disposal of much of the above-ground transuranic waste that is 
currently stored on the mesa at the Laboratory. In addition, all 
remedial actions related to soil cleanup will be completed in the 
northwest section of Oak Ridge National Laboratory.
                        reducing life-cycle cost
    EM will continue to identify opportunities to make strategic 
investments that reduce the overall cost of the cleanup program while 
shortening project and program schedules. The current life-cycle cost 
estimate for EM is $274 to $309 billion. This includes $100 billion in 
actual costs from 1997 through 2011, and an additional estimate of $174 
to $209 billion to complete EM's remaining mission in the timeframe of 
2050 to 2062. EM will continue to identify opportunities, including 
technology development, to reduce the life-cycle cost of its program. 
In fiscal year 2013, EM will continue efforts to develop technologies 
that allow for the segregation and stabilization of mercury 
contaminated debris; develop attenuation-based remedies for 
groundwater; and utilize technologies that enable the safe extended 
storage of spent (used) nuclear fuel at DOE sites. To enhance its 
technology program, EM has established the position of Chief Scientist 
to provide recommendations to the Senior Advisor for Environmental 
Management on complex technical and design issues.
                    contract and project management
    To ensure that EM delivers the best value for the American 
taxpayers, the fiscal year 2013 budget request reflects its continued 
improvement in acquisition, contract, and project management. EM will 
require more rigorous front-end planning ensuring contract statements 
of work and deliverables are based on clear project requirements and 
assessment of risks; nuclear safety requirements are addressed early; 
and changes to the contract and the project baseline are managed 
through strict and timely change control processes. EM will further 
improve acquisition processes by obtaining early involvement and 
approvals on various acquisition approaches from DOE senior management, 
including the Office of Engineering and Construction Management, the 
Office of Procurement and Assistance Management, the Office of the 
General Counsel, and the Office of Small and Disadvantaged Business 
Utilization.
    In terms of project management, since August 2009, EM has been 
utilizing the Office of Science model for construction project review/
project peer review process that relies on the expert knowledge and 
experience of certified engineers, scientists, DOE contractors, 
engineering laboratories, and the academic community. These reviews 
determine whether the scope of projects and the underlying assumptions 
regarding technology, management, cost, scope, and schedule baselines 
are valid and within budget. These reviews are scheduled to occur 
approximately every 6 months and assist EM with actively addressing 
problems and monitoring the effectiveness of the resulting corrective 
actions.
    Over the last 2 years, EM has established separate operations 
activities and capital asset projects within its Project Baseline 
Summaries. Capital asset projects are managed in accordance with DOE 
Order 413.3B, Program and Project Management for the Acquisition of 
Capital Assets. EM is currently finalizing the operations activities 
policy and the protocol to manage operations activities, which are not 
governed by DOE Order 413.3B.
    EM's continued progress in contract and project management has 
resulted in EM meeting three of the five criteria needed in order to be 
removed from the Government Accountability Office's (GAO) High Risk 
List. GAO has noted that: EM has demonstrated strong commitment and 
leadership; demonstrated progress in implementing corrective measures; 
and developed a corrective action plan that identifies root causes, 
effective solutions, and a near-term plan for implementing those 
solutions.
    One of GAO's remaining concerns is that EM must provide the 
capacity (people and resources) to address problems. To address GAO's 
first concern, EM's reorganization establishes project sponsor 
positions at Headquarters for all capital asset projects. EM is also 
continuing to enhance its partnership with the U.S. Army Corps of 
Engineers by supplementing selected project peer review teams with U.S. 
Army Corps of Engineers personnel who have demonstrated expertise in 
project and contract management.
    GAO's second remaining concern is that EM must monitor and 
independently validate the many corrective measures that it has taken 
are both effective and sustainable over the long term. To address this 
concern, EM's Annual Performance Plans have been established as a 
vehicle for measuring, tracking, and validating progress. In addition, 
EM has developed an annual Continuous Improvement Plan for Contract and 
Project Management to guide and monitor improvements. EM will continue 
to share improvements in project and contract management with GAO and 
other stakeholders. EM is committed to continued improvements in 
contract and project management and is focused on being removed from 
GAO's High Risk List.
           highlights of the fiscal year 2013 budget request
    The fiscal year 2013 budget request for EM is $5.65 billion, after 
offsets of $485.1 million. The offsets reflect the proposed 
reauthorization of the D&D Fund deposit ($463 million), and the use of 
prior year uncosted ($12.1 million) and unobligated ($10 million) 
balances to offset ongoing mission work in the EM program. The fiscal 
year 2013 budget request for EM is made up of $5.49 billion for defense 
environmental cleanup activities. Examples of planned activities and 
milestones for fiscal year 2013 by site-specific categories are:

                    Idaho National Laboratory, Idaho
                        (In Thousands of Dollars)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$389,800..................................  $405,397
------------------------------------------------------------------------

         Complete operations of the Sodium Bearing Waste 
        Treatment Facility.

         The Sodium Bearing Waste Treatment Facility supports the 
        cleanup mission at Idaho National Laboratory by treating the 
        remaining approximately 900,000 gallons of sodium bearing waste 
        stored in tanks that are 35 to 45 years old. The treatment of 
        this waste will enable EM to close the final four tanks, 
        complete treatment of all tank waste at Idaho, and meet the 
        Notice of Noncompliance Consent Order Modification to cease use 
        of the Tank Farm Facility by December 31, 2012. Testing and 
        readiness verification on the Sodium Bearing Waste Treatment 
        Facility will be completed in preparation for startup in the 
        third quarter of fiscal year 2012.

         Ship contact-handled transuranic waste to the Waste 
        Isolation Pilot Plant, as well as retrieve buried waste.

         During fiscal year 2013, approximately 4,500 cubic meters or 
        more of contact-handled transuranic waste will be shipped to 
        the Waste Isolation Pilot Plant for disposal. In addition, 
        small quantities of buried waste will be retrieved and shipped 
        to the Waste Isolation Pilot Plant for disposal.

               Los Alamos National Laboratory, New Mexico
                        (In Thousands of Dollars)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$188,561..................................  $239,143
------------------------------------------------------------------------

         Disposition of transuranic waste and low-level/mixed 
        low-level waste.

         The Solid Waste Stabilization and Disposition Project is 
        comprised of the treatment, storage, and disposal of legacy 
        transuranic waste and low-level/mixed low-level waste generated 
        between 1970 and 1999 at Los Alamos National Laboratory. The 
        end-state of this project is the safe disposal of legacy waste. 
        In fiscal year 2013, to support the requirements in the 2005 
        Compliance Order on Consent, Los Alamos National Laboratory 
        will disposition 1,603 cubic meters of transuranic waste and 
        continue low-level/mixed low-level waste disposal activities.

         Maintain soil and water remediation.

         The Soil and Water Remediation Project scope at Los Alamos 
        National Laboratory includes identification, investigation, and 
        remediation of chemical and/or radiological contamination 
        attributable to past Laboratory operations and practices. The 
        remaining scope of the project includes characterization, 
        monitoring, and protection of the surface and groundwater at 
        the Laboratory and approximately 860 Potential Release Sites 
        left to be investigated, remediated or closed after evaluation 
        and assessment of human health and ecological risks. In fiscal 
        year 2013, activities include: investigation and 
        characterization of two Technical Areas under the Canon de 
        Valle Capital Asset Project and completion of the investigation 
        and corrective measures evaluation of Material Disposal Area T 
        to obtain final regulatory remedy selection.

                    Oak Ridge Reservation, Tennessee
                        (In Thousands of Dollars)
                (Includes Safeguards & Security Funding)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$419,758..................................  $421,250
------------------------------------------------------------------------

         Maintain operation of the Transuranic Waste Processing 
        Center.

         The continued operation of the Transuranic Waste Processing 
        Center enables EM to meet various regulatory milestones. By the 
        end of fiscal year 2013, Oak Ridge will process a cumulative 
        total of 236 cubic meters of contact-handled transuranic waste 
        and a cumulative total of 70 cubic meters of remote-handled 
        transuranic waste at the Transuranic Waste Processing Center in 
        preparation for eventual disposition. Fiscal year 2013 
        activities include the: continued transfers of transuranic 
        waste bound for the Transuranic Waste Processing Facility; and 
        the continued processing and disposition of contact-handled 
        transuranic and remote-handled transuranic waste.

         Mitigate mercury contamination at the Y-12 National 
        Security Complex.

         Mercury cleanup activities within the Y-12 National Security 
        Complex are necessary to reduce the potential contamination of 
        the Upper East Fork Poplar Creek that flows through the city of 
        Oak Ridge. In fiscal year 2013, with the utilization of 
        American Recovery and Reinvestment Act funds, EM will complete 
        characterization activities at the Y-12 National Security 
        Complex land area formerly housing the Building 81-10 Mercury 
        Recovery Facility.

                        Richland Site, Washington
                        (In Thousands of Dollars)
                (Includes Safeguards & Security Funding)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$1,021,824................................  $1,037,773
------------------------------------------------------------------------

         Continue facility D&D and remedial actions within the 
        River Corridor.

         The River Corridor Closure Project includes the D&D of 
        contaminated facilities and various remedial actions along the 
        Columbia River Corridor as part of EM's continued pursuit of 
        the Hanford 2015 Vision. In an effort to reduce Hanford's 
        cleanup footprint, fiscal year 2013 activities include: 
        operating the Environmental Restoration Disposal Facility in 
        support of Hanford Site demolition and remediation activities; 
        completing the interim response actions for the 100 N Area; 
        completing the interim remedial actions for the 300-FF-2 Waste 
        Sites; completing the selected removal and/or remedial actions 
        for 13 high risk facilities in the 300 Area; and continuing the 
        remediation of the 618-10 and 618-11 burial grounds.

         Conduct groundwater remediation efforts.

         To protect the groundwater resources within the Hanford site, 
        remediation activities that address groundwater contamination, 
        including carbon tetrachloride, chromium, technetium, and 
        strontium, must be conducted. In fiscal year 2013, EM will: 
        continue site-wide groundwater and vadose zone cleanup 
        activities; groundwater contamination monitoring, operations, 
        and necessary modifications of existing remediation systems; 
        and deploy chemical and biological treatment to select areas in 
        support of final remedies.

                 Office of River Protection, Washington
                        (In Thousands of Dollars)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$1,181,800................................  $1,172,113
------------------------------------------------------------------------

         Manage the tank farms in a safe and compliant manner 
        until closure.

         The radioactive waste stored in the Hanford tanks was produced 
        as part of the Nation's defense program and has been 
        accumulating since 1944. To ensure protection of the Columbia 
        River, over 50 million gallons of radioactive waste must be 
        removed and processed to a form suitable for disposal, and the 
        177 underground storage tanks to be stabilized. In fiscal year 
        2013, activities include: complete bulk retrieval of one C Farm 
        single shell tank; completing hard heel removal of two C Farm 
        single shell tanks; operating the 222-S laboratory and 242-A 
        evaporator; and continuing activities for tank waste mixing.

         Continue construction of the Waste Treatment and 
        Immobilization Plant complex.

         The Waste Treatment and Immobilization Plant is pivotal to 
        EM's tank waste cleanup mission at Hanford. The Waste Treatment 
        and Immobilization Plant provides the primary treatment 
        capability to immobilize (vitrify) the radioactive tank waste 
        at the Hanford Site. The Waste Treatment and Immobilization 
        Plant complex includes five major facilities: Pretreatment 
        Facility, High-Level Waste Facility, Low-Activity Waste 
        Facility, Analytical Laboratory, and the Balance of Facilities. 
        As of December 2011, the Waste Treatment and Immobilization 
        Plant construction is approximately 59 percent complete and 
        design is 84 percent complete. In fiscal year 2013, activities 
        include the following:

         At the Pretreatment Facility, continue engineering, 
        design and large scale integrated testing to confirm the design 
        of critical Pretreatment process vessels.
         At the High-Level Waste Facility, continue forming, 
        rebar, and placement of concrete for High-Level Waste Facility 
        walls and slabs on the third to fourth stories.
         At the Low-Activity Waste Facility, continue planning 
        activities for construction startup and turnover of multiple 
        Low-Activity Waste Facility systems to operations.
         At the Analytical Laboratory, complete mechanical 
        systems procurement and complete electrical terminations.
         At the Balance of Facilities, complete Balance of 
        Facilities Plant design engineering and complete construction 
        of nine facilities that make up the Balance of Facilities 
        including the Chiller Compressor Plant and Steam Plant.


                   Savannah River Site, South Carolina
                        (In Thousands of Dollars)
                (Includes Safeguards & Security Funding)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$1,316,922................................  $1,303,493
------------------------------------------------------------------------

         Reduce radioactive liquid waste.

         The mission of the Liquid Tank Waste Management Program at 
        Savannah River Site is to safely and efficiently treat, 
        stabilize, and dispose of approximately 37 million gallons of 
        legacy radioactive waste currently stored in 49 underground 
        storage tanks. In fiscal year 2013, activities include: 
        continue construction of Salt Waste Processing Facility; 
        continued operation of F and H Tank Farms; continued to 
        operation the Defense Waste Processing Facility and the 
        production of 312 canisters of high-level waste packaged for 
        final disposition; continued operation of the actinide Removal 
        Process and Modular Caustic Side Solvent Extraction at planned 
        rates; continued operation of the Saltstone Facility at planned 
        rates; and continue construction of Saltstone Disposal Units 3-
        5.

         Consolidation of special nuclear materials.

         In fiscal year 2013, activities include: initiation of the 
        processing of non-pit plutonium to produce plutonium oxide 
        suitable for use in the MOX Fabrication Facility; packaging the 
        non-MOX plutonium for disposition to the Waste Isolation Pilot 
        Plant; reducing the residual plutonium-238 contamination in the 
        F Area Materials Storage Facility; and initiating the 
        disposition of any vulnerable spent (used) nuclear fuel in H 
        Canyon that is not suitable for extended storage in L-Basin.

                 Waste Isolation Pilot Plant, New Mexico
                        (In Thousands of Dollars)
                (Includes Safeguards & Security Funding)
------------------------------------------------------------------------
  Fiscal Year 2012 Current Appropriation      Fiscal Year 2013 Request
------------------------------------------------------------------------
$218,179..................................  $202,987
------------------------------------------------------------------------

         Operate the Waste Isolation Pilot Plant in a safe and 
        compliant manner and dispose of contact-handled and remote-
        handled transuranic waste from DOE sites.

         The Waste Isolation Pilot Plant in Carlsbad, New Mexico, is 
        the Nation's only mined geologic repository for the permanent 
        disposal of defense-generated transuranic waste. In fiscal year 
        2013, the EM budget request supports maintaining an average 
        shipping capability of 21 contact-handled transuranic waste and 
        5 remote-handled transuranic waste shipments per week from 
        major shipping sites such as Idaho, Savannah River Site, and 
        Los Alamos National Laboratory.
                               conclusion
    Mr. Chairman, Ranking Member Sessions, and members of the 
subcommittee, I am honored to be here today representing the Office of 
Environmental Management. EM is committed to achieving its mission and 
will continue to apply innovative environmental cleanup strategies to 
complete work safely, on schedule, and within cost thereby 
demonstrating value to the American taxpayers. I am pleased to answer 
any questions you may have.

    Senator Nelson. Thank you. Thank you, all three.
    Admiral, what is it, fair seas and prevailing wind, or 
whatever; may I wish you that.
    Admiral Donald. Thank you.
    Senator Nelson. Thank you for your service.
    Dr. Cook, you mentioned the B61 gravity bomb, but it's my 
understanding you've been recently granted the go-ahead for the 
engineering work on the B61 gravity bomb. If that's true, it's 
good news and congratulations. Of course, the question that 
follows is when would you be able to provide us with a design 
definition and cost estimate study, or more commonly called a 
6.2A study, for the LEP of the B61 that would come from this 
work?
    Dr. Cook. The short answer is we expect to provide a full 
report by July. We're doing costing work now between NNSA and 
the Cost Analysis and Program Evaluation (CAPE) Group of DOE. 
That work is aggressively underway, and it is a fact that the 
NWC Chairman Frank Kendall signed out the authorization letter, 
and so we're now going through the steps we require and are 
normal to begin the engineering work.
    Senator Nelson. Very good. In connection with the 
extension, in DOD any major acquisition program requires by 
statute an independent cost estimate by the CAPE Office. Do you 
believe that it's sound policy and likewise should be so for 
any major extension program or similar large engineering 
weapons effort in NNSA as in the case of the B61?
    Dr. Cook. I generally do, sir.
    Senator Nelson. Dr. Cook, what's the status of the 6.1 
study on the W78 warhead, and do you think having a common 
warhead with the W88 is feasible?
    Dr. Cook. The current status of the W78/88 study is that, 
first, it is joint. The study has both Air Force and Navy 
participation, certainly NNSA participation with our labs, and 
some elements of the production plants, as well as STRATCOM and 
DOD civilian participation. So we believe that we are likely to 
complete the 6.1 study this fiscal year and move into a 6.2 
study. 6.2A comes later, but we still have more work to do. So 
that will be a topic for NWC determination later in the year.
    Senator Nelson. It's my understanding that DOE worked with 
DOD to transfer some $8 billion budgetary authority over the 
next 10 years to perform a number of tasks, one of which was to 
complete design and begin construction of the CMRR and commence 
operations by 2022. As part of this transfer, my understanding 
is that DOE was to plan to produce 50 to 80 pits per year in 
2022 in the Los Alamos PF4 facility which makes the plutonium 
pits. Do you still believe that there is the ability to produce 
50 to 80 pits per year and that that's a valid requirement? 
Will you have to renegotiate the 2022 date for making those 50 
to 80 pits per year based on your decision to defer the 
construction of the CMRR building?
    Dr. Cook. If I could, I'd address several points of your 
question, and I'll try to speak fairly quickly.
    Senator Nelson. Yes, sure.
    Dr. Cook. With regard to CMRR and the UPF, I will link 
those, and the LEPs, our strategy is a balanced strategy. We 
have worked it through with the Senate Armed Services 
Committee, with STRATCOM, and DOD. When we looked at the key 
priorities first for B61, would we start that or not, for the 
UPF and the CMRR Nuclear Facility, there was a very large body 
of work, and the requirement for providing cost for that to do 
all three in parallel did not look like it could be supported 
in the budget reality that we have. There was a change in 2012, 
as you all know, and going forward we determined that we would 
choose not to delay the B61, and there's a sizable investment 
there.
    We determined that the most cost-effective strategy for the 
UPF, where we don't have another option because we make the 
secondaries in building 9212, the best cost strategy would be 
to actually accelerate the UPF conventional construction. We'll 
deal with the tooling near the end of the project, but we want 
to move aggressively once the conventional construction is 
completed in the period of a few years to move out of building 
9212 because of the large operational and programmatic risk. 
It's our intent to begin that migration in 2019.
    With regard to CMRR now, a piece that's already done is the 
radiological lab, as mentioned already. We will substantially 
complete the engineering design for CMRR in 2012 and we will 
tie that up with a cost estimate for that design when we then 
defer construction. But it's a rational point. Without that 
deferral on CMRR we could not do both the B61 and the UPF. So 
it was a conscious choice.
    With regard to now the pit numbers, it's a fact that what 
we're doing with the W76 LEP, known as the 76-1, and what we 
intend to do with the B61-12 is pit reuse. There are three 
different approaches here. They're certainly written in our 
program plans. One is pit reuse, one is pit refurbishment, and 
one is manufacturing newly manufactured pits, but of existing 
design. No new military requirements or characteristics that 
are essential.
    So to get to the end of the answer, we do believe that we 
can continue conducting a very aggressive modernization program 
for LEPs by using all three of those. But the real impact of 
the decision to defer CMRR by 5 years means that it will not be 
operational by, the correct number was 2023, as we laid out in 
the last set of reports last year. That will now not be sooner 
than 2028.
    But I again will emphasize, as the Administrator has, we've 
not cancelled it. We have decided that the immediate need was 
to support the B61 LEP as it is the oldest weapons system that 
we have in our stockpile. I think I've mentioned the rest.
    Senator Nelson. Thank you. Do you agree with Mr. 
D'Agostino's risk management and risk assessment and risk 
analysis comments about that this will not impair the ability 
to move forward with the missions that are being undertaken?
    Dr. Cook. I absolutely do. I'll state that we have made 
conscious decisions to have a balanced program, and part of 
those decisions has been to accept a higher risk and to manage 
that risk. We have many talented people. They understand the 
decisions that we've taken and we're going forward with the 
priorities that we have agreed at the NWC.
    Senator Nelson. Can you explain the differences in numbers 
for the B61 and W76 warhead LEPs? In your fiscal year 2012 
budget submission, you were going to request for fiscal year 
2013 about $279 million for the B61 and $255 million for the 
W76 LEPs. This year, for the fiscal year 2013 request, we see 
you requested $361 million for the B61, $82 million more than 
you thought you'd need last year, and $175 million for the W76 
LEP, actually about $80 million less than you thought you'd 
need last year.
    Dr. Cook. That is accurate. So this is part of the trade 
study that we did and the balance. We recognized, as more work 
was done on the B61-12, when we went through the options in the 
decisionmaking process for the NWC, we wound up taking, not the 
largest cost option and not the lowest cost option, which would 
not have been a LEP but only replacing limited life components. 
The latter would have driven us into either needing to take 
that weapons system out of service in a matter of time or we 
would have just kicked down the road for a few years, maybe 5 
years, possibly 10, a more aggressive LEP for the B61.
    So you see that that larger cost estimate for the B61 is 
reflected in the President's request for fiscal year 2013.
    With regard to the W76, the strategy is that we will build 
the hedge for the W76-1s after we have supported all 
operational requirements. Once again, there's no question that 
we are taking a somewhat higher risk. We have used up some of 
the margin that we might otherwise have in building ahead 
should we have an operational difficulty in manufacturing the 
76-1s, and the budget reflects having a rate of manufacturing 
and production which is comparable to the current rate, 
extending the hedge-building at the end of the operationally 
deployed weapons.
    Senator Nelson. What is the effect of this lower request 
number for fiscal year 2013 on the W76 program with the Navy's 
submarine fleet?
    Dr. Cook. I'll say where we are in the President's request. 
We believe that we have a manageable program, but there is very 
little margin for error. NNSA is working with the Navy to 
understand some of the details now of the Navy requirements, at 
the same time that we're sharing in a very open and transparent 
way what our operating plans are at Pantex for assembly or at 
Kansas City site for components.
    We're working that together. If we determine that there's 
something that has a risk that we feel we cannot manage, that 
the risk is too large, then we'll make accommodations for that 
when we determine it. At this point we've not yet found a major 
stumbling block.
    Senator Nelson. So this is a dynamic effort that could 
change depending on what risk assessment you might do as you 
engage in the life extension?
    Dr. Cook. That is correct.
    Senator Nelson. Admiral Donald, from our discussion the 
other day, I understand DOD is moving the construction of the 
first Ohio-class replacement submarine by 2 years to 2021, 
which saves some $4.3 billion over the next 10 years. I 
understand this has also impacted your budget profile, such 
that last year you were going to ask for $149.7 million for 
fiscal year 2013 and this year it is now $89.7 million, down 
some $60 million.
    Can you explain to us what impact this will have on the 
funding reduction and whether it affects any other portions of 
the naval reactors program?
    Admiral Donald. Yes, sir, Mr. Chairman. The decision to 
extend the Ohio replacement, and to delay it 2 years, was part 
of a larger discussion to address the BCA reductions with DOD 
overall. I participated in that decisionmaking process both 
from my point of view as the hat in the U.S. Navy, but also 
with great interest from my role in NNSA. I agreed with that 
decision, acknowledging there's risk, and I'd characterize the 
risk in two categories.
    First, is programmatic risk. Implicit in the decision is 
that the resources would be made available to conduct the work 
so that we can start construction on the ship in 2021 with a 
sufficiently mature design, such that we can control cost, 
schedule, and deliver a quality product. On the Navy side, the 
DOD side, that is the case. In fiscal year 2013 and beyond, the 
resources are there for us to execute that program as we deem 
necessary and effective.
    On the NNSA side, for fiscal year 2013, I'm comfortable 
with the resources I have. But, as Mr. D'Agostino pointed out, 
the placeholder numbers that are in the fiscal years 2014 
through 2017, if they were to remain in place, I would not be 
able to fulfill that obligation to deliver the reactor plant 
for that ship on time. That's acknowledged both in DOD and 
NNSA, and the work to resolve that is ongoing right now.
    Senator Nelson. Is that part of what you would call the 
appropriations risk?
    Admiral Donald. Yes, sir.
    Senator Nelson. That's not a risk--it's a risk you assume, 
but not one you have a lot of control over, right?
    Admiral Donald. Yes, sir.
    Senator Nelson. It's on this side of the desk we have to 
reduce that risk; is that a fair way of saying it?
    Admiral Donald. Yes, sir.
    Senator Nelson. I understand.
    Admiral Donald. The second element of risk is operational 
risk. What that delay entails is the number of SSBNs available 
for the strategic mission when you get out to 2029 to 2041, a 
long way off obviously, but that's when the first of the Ohio-
class replacements will be coming on line with the delayed 
schedule. The result during that period of a time is only have 
10 SSBNs available to fulfill the strategic mission.
    Now, remember we've reduced the number of SSBNs required 
from 14 to 12. That was based on our action to develop the 
life-of-the-ship core so we could eliminate the midlife 
refueling, minimize the time in maintenance, and improve the 
operational availability. So there was already some risk 
associated with that. This further adds to that risk.
    It's acknowledged that if the strategic requirement does 
not change, there will be some periods of challenge during that 
window of time with the number of ships out there to meet 
STRATCOM's requirements for ships at sea and ships available on 
notice.
    The second aspect of that operational risk is a recognition 
that in 2029--that's right before the first Ohio-class 
replacement comes on line--the average age of the ballistic 
missile submarine force will be 37 years. That is well in 
excess of, on a class basis, anything we've ever done in the 
past. We acknowledge that that does come with some risk. We are 
certainly committed to mitigating that risk and we do take good 
care of these ships to ensure they last for their full life 
expectancy.
    But, as with anything that arrives at that age with that 
operational tempo that they fulfill, there is a certain risk 
that ships may not be available because of material problems 
and things of that sort. That tends to be the situation with 
ships of that age.
    Senator Nelson. Is it fair to say--this goes to Dr. Cook as 
well--that in life extensions, we're able to make those life 
extensions because as time goes by we develop new ways, new 
methods of life extension? In other words, some things we can't 
change, but other things we learn we can improve? Is that one 
of the reasons why we get life extensions beyond the original 
projections?
    Admiral Donald. I would say there's a couple of issues that 
are a part of being able to extend the life. First, it starts 
off with a good design from the beginning, and if you look at 
the Ohio-class submarines, that was a very well-designed ship. 
It was designed to be maintained over a long lifetime. That 
facilitates our ability to maintain it and maintain it 
effectively.
    Second, you do have to invest in the maintenance as you go 
along. It's just like changing the oil in your car. If you do 
that when you're supposed to, you're going to get the life out 
of it that you would fully expect to get for an investment of 
that nature.
    The third thing is, you do, in fact, learn things as you 
get more experience with the design, as life goes on. We see 
that even today in such mundane things as how do you prevent 
rust and corrosion and add life. You get a sense of the 
operational tempo of the ship and how much fatigue, stress, and 
things like that. So you do learn as you go along.
    But the fourth thing, and I think it's critically 
important, is applicable both to Dr. Cook and to me as well, is 
that you have the technical resources at your disposal to 
address issues as they arise, and they do. Unexpected things do 
come along. You do have to address those types of things with 
knowledgeable people, with engineers, designers who understand 
that, who have the experience to deal with those types of 
things. Hence, the importance of the intellectual capital that 
we have in our laboratories to go and address those. We see 
that to this very day.
    Senator Nelson. Very good.
    Dr. Cook?
    Dr. Cook. If I can follow up to Admiral Donald, I agree 
that many of the things he's mentioned are correct in 
weaponland as well. When we talk about science and weapons 
science, we could use words such as the ``core capability'' for 
the national lab directors to do annual assessments of the 
existing stockpile. That's one of the most important jobs that 
we have. You could tell from my voice we are proud that the 
Stockpile Stewardship Program has given us 20 consecutive years 
of not having to go back to do underground testing.
    The fact that these weapons systems are so thoroughly 
surveilled--and you are well aware and you supported a more 
aggressive surveillance program for the past few years--that 
gives us an ability to determine with data which parts of these 
weapons systems give us the most concern, and by the people, as 
Admiral Donald said, who are most technically able to do that 
for weapons within the weapons labs.
    So, that's the choice. In fact, sometimes we say we can go 
further on because some of the concerns have not grown more 
severe, where in other systems something unanticipated 
happened, but, thankfully, corrosion or whatever occurred was 
noticed and now we know we need to adjust our schedules.
    Senator Nelson. Admiral Donald, I know you maintain a large 
fleet of reactors at sea that's funded by the Navy. Can you 
explain any impacts that the BCA might have on these reactors?
    Admiral Donald. Yes, sir. In my opening statement, I 
discussed that my first priority is to ensure the safety and 
effectiveness of those reactors that are operating at sea, the 
two that we have in land-based locations, and the two that we 
have in shore facilities as well. That's my charter, that's my 
responsibility, and when it comes to applying my resources, 
that's where they will be applied first. That is my strategy 
right now for dealing with, if there should happen to be some 
shortfalls in the overall budget, that I will first make sure 
that the fleet is operating safely and has what it needs to 
continue to operate, and then I will apply my resources to the 
projects, whether they be the replacement for the Ohio-class, 
the land-based prototype refueling, or the expended core 
facility in Idaho. I will deal with those next in order.
    Senator Nelson. But there could be some implications to the 
rest of the budget, that you might have to rob one account to 
take care of the other account to take care of the safety of 
the reactors; is that fair to say?
    Admiral Donald. That's correct, yes, sir. The first 
priority is safety of those reactor plants.
    Senator Nelson. Admiral Donald, can you explain the status 
of the construction of the new spent fuel pool at the Idaho 
National Laboratory?
    Admiral Donald. Yes, sir. The Spent Fuel Handling 
Recapitalization Project that's in my budget, I do have $28.6 
million this year for some conceptual work and also some 
environmental studies. This facility is vital to our business. 
This is where all of our spent fuel goes to be examined and 
ultimately processed into dry storage. The facility allows us 
to meet our commitments to the State of Idaho, but also to 
support the operating fleet, to ensure that the cores that we 
load into these ships perform as we expect them to perform.
    This facility is aging. It's 50 years old in many parts. It 
has its challenges, whether it be seismic certifications, 
whether it be leaks and things of that sort, that we manage on 
a day-to-day basis. But it is aging and needs to be replaced, 
and that's the project that we're here to undertake.
    Senator Nelson. So you're not going to be in a position 
where you can use both simultaneously? One will replace the 
other? I understand that there's already another spent fuel 
pool at the Idaho Laboratory, but that you're designing for a 
new one. My question is, will you be able to use both or will 
the new one replace the old one?
    Admiral Donald. We have an existing facility that needs to 
be replaced. There is also another water pit facility.
    Senator Nelson. That's operational?
    Admiral Donald. That's operational. It's Building 666, as 
it's referred to in Idaho. We have looked at that as a 
potential source for us to use whether during the interim as a 
part of the transition from our old facility to the new 
facility. We found it to be unsatisfactory. It doesn't meet our 
requirements from a capability point of view, from a capacity 
point of view, and from a timing point of view.
    Specifically, the water pit is not configured properly to 
handle the fuel that we will be bringing off of our aircraft 
carriers. It's not deep enough. The fuel is in a configuration 
that's too long. There are a couple of locations in the water 
pit where it would handle that longer fuel, but those locations 
are currently occupied by existing spent fuel that won't be out 
of that water pit until the 2023 timeframe. Even if it were 
available, it wouldn't be of sufficient capacity to deal with 
the flow that we have coming off the ships.
    The other aspect of this facility is, even if we tried, 
there'd be some significant facility modifications that would 
be required, whether in additional cranes, raising the height 
of the building to support the extra length of the fuel. All of 
that would have to be done in a radiologically controlled area, 
which would add significantly to the cost.
    So we looked at it both in 2005 and 2009 and concluded 
that, no, it did not meet the need. Ultimately it doesn't--we'd 
still have to have a new facility at our facility anyway to 
deal with this 50-year-old facility we have right now.
    Senator Nelson. I understand. Thank you.
    Mr. Huizenga, I understand you've recently taken over the 
job of managing the DOE's Office of EM. Congratulations again.
    Having said that, what is the status of the Hanford Waste 
Treatment Plant and when will you begin to drain the high-level 
waste tanks into the plant to produce what are called glass 
logs?
    Mr. Huizenga. Thank you, sir. You did point out we were on 
the front page of USA Today in your opening remarks, and I will 
try to address that. It's a complicated, extremely large 
facility, of course, with many different individual facilities. 
The good news is that four out of the five major facilities 
we're making steady progress on. I think it's fair to say that 
we do have some issues with the final one, the pretreatment 
facility, and we're indeed in the process now of trying to work 
through some testing to ultimately prove that that facility 
will be able to mix these complicated wastes in a satisfactory 
fashion.
    So we are making steady progress on some, we're working on 
testing for the others. The fiscal year 2013 funding level will 
allow us to continue to make steady progress and do this 
testing and also work on the tank farms that are associated 
with this facility that will ultimately feed liquid into these 
facilities. So we think we have a solid strategy for success.
    Senator Nelson. What's the status of the salt waste 
processing facility at the Savannah River Site? I understand 
there may have been some cost overruns and some delays in that 
project.
    Mr. Huizenga. Yes. As a matter of fact, I was down there 
earlier this week with Under Secretary D'Agostino. We had an 
opportunity to walk through that facility personally and ask a 
lot of questions, make sure that we are indeed understanding 
what needs to be done.
    The biggest problem that we have there, frankly, is we have 
some complicated vessels that are being manufactured and we've 
had some delays in receipt of those vessels. We were supposed 
to have received them late last year. Now it looks like we'll 
be receiving them in the next month or so.
    I know the Under Secretary made a trip to this vendor to 
actually make sure that they were focused. We haven't had this 
discussion with Admiral Donald, but I know they're doing some 
work for him as well. So they have a lot of work on their plate 
and we're trying to get them to make sure that they deliver.
    But the bottom line is we've had to leave a hole in the top 
of the facility and do some work-arounds in order for us to be 
able to lower those vessels. There are 10 of them, 6 in one 
area and 4 in another--in order to lower those down onto the 
floor and then go ahead and put the ceiling or the roof in 
place.
    So we don't know for a fact what it's going to do to our 
schedule. We still think that we can complete this some time 
around October 2015, which is our baseline. When we get the 
vessels in, we're going to have to address what it will do to 
our overall costs.
    Senator Nelson. In the 2011 DOE financial report, it lists 
the cleanup liability for former Cold War production sites at 
some $250 billion over the next 75 years. Some of these are 
highly contaminated sites that will require, once cleaned up, 
even continued monitoring into perpetuity. We're now in a world 
of flat or declining budgets, and yet your office is driven by 
legally enforceable milestones with the States where many of 
these sites, like Hanford, reside in.
    How are we going to make it work? How are we going to, over 
a longer strategy, make the dollars work to meet the 
obligations we've undertaken?
    Mr. Huizenga. I think it's fair to say, Mr. Chairman, that 
we're going to have to continue to look for efficiencies and 
technology improvements, to look for basically some game-
changers in the way we do business as these budgets flatten 
out. It's been tough for the last couple of years. I know 
you've had a lot of things to balance up here, and we've indeed 
had some reductions in our requests, and to that extent we're 
looking now strategically across the complex at a way that we 
might rebaseline our efforts over the next few years to 
accommodate what is likely to be a flatter budget portfolio.
    I think again there are some bright spots. When we were at 
the Savannah River Site, we were talking to them about the fact 
that they're developing some new solvents that will help remove 
radioactivity from one vessel or one solution and bring it into 
another one to be resolidified in these glass logs. There are 
ways that you can do this that can actually increase the 
effectiveness and reduce the time of operations of the 
facilities by several years and save several billions of 
dollars. So we're looking for ways to improve the way we're 
doing business.
    Senator Nelson. Obviously, that is going to be required, 
because--and it's not to say that we can't get smarter as we 
have more experience moving forward. So hopefully there will be 
some cost savings achieved with better techniques as we learn 
more about what we're doing.
    Then finally, what's the status of the Greater-Than-Class C 
waste environmental impact statement (EIS)? I understand this 
type of waste is particularly troublesome and, as difficult as 
everything else is, this is perhaps even more so.
    Mr. Huizenga. We issued an EIS on the Greater-Than-Class C 
waste in February 2011, and we conducted a 120-day public 
comment period. We got over 5,000 comments. We're in the 
process right now of reviewing those and taking those into 
consideration. We hope to issue a final EIS later this year, 
and we're going to consult with Congress, as is required by the 
Energy Policy Act of 2005. When we develop our preferred 
alternatives, we'll be up here talking to you about ways that 
we hope to move forward.
    This is another area of the synergies between NNSA and the 
EM program, because ultimately when we can develop a preferred 
place to dispose of these materials you know that NNSA has been 
collecting materials that could be used for dirty bombs. Some 
of those are Greater-Than-Class C, sealed sources, and those 
we'd hope to be able to dispose of permanently and take them 
out of harm's way.
    Senator Nelson. I wish you good luck in doing that. While I 
don't have a strong portfolio in science, I do have to point 
out that I was president of the science club in high school. 
[Laughter.]
    Mr. Huizenga. We might come to you with some questions 
then, sir. [Laughter.]
    Senator Nelson. I knew a few things back then and that's 
probably where it all stayed.
    I want to thank you particularly, Admiral Donald, for your 
continuing service over the years. Thank you for service to our 
country. To all of you, thank you for what you're doing for our 
country in a very vital area. We want to work with you, with 
budgets. Obviously, we're going to ask serious, deep, probing 
questions, deep for us at least, to try to understand more 
about what it is you're doing and also how we can help you do 
what you need to do to reduce the appropriations risk that you 
always face. The requirement will be there. You need to have 
the adequate resources to be able to meet those requirements, 
and sometimes when they don't quite match, we need to work 
together to find different ways of doing it.
    So thank you all. The hearing is adjourned. Thank you.
    [Questions for the record with answers supplied follow:]
               Questions Submitted by Senator Ben Nelson
                national nuclear security administration
    1. Senator Nelson. Mr. D'Agostino, when Congress created the 
National Nuclear Security Administration (NNSA) in 1999, its principal 
concern was to create a semi-autonomous agency that was free from the 
larger elements of the Department of Energy (DOE) so that it could 
focus on its core defense-related missions. In fact, if you read the 
first sentence of the statute it says, ``There is established within 
the Department of Energy a separately organized agency to be known as 
the National Nuclear Security Administration.'' Would you please 
provide legislative suggestions or technical drafting assistance on how 
the NNSA can still report to the Secretary of Energy but be more 
independent of the rest of the DOE, similar to say the Federal Energy 
Regulatory Commission (FERC)?
    Mr. D'Agostino. The legislative decision raised in your question is 
clearly within the congressional prerogative. Although we are committed 
to assisting Congress in legislative endeavors, there has not been 
sufficient time to provide the appropriate analysis and support for 
your request at this time. We will keep you apprised as we review all 
the potential alternatives and impacts that are identified.

    2. Senator Nelson. Mr. D'Agostino, there has been concern in the 
NNSA about satisfying the Defense Nuclear Facilities Safety Board 
(DNFSB) recommendations. This board is an advisory body, not a 
regulator. Some in either Department of Defense (DOD) or NNSA have gone 
so far as to suggest NNSA and DOE be regulated by the Nuclear 
Regulatory Commission (NRC). Do you support having NNSA regulated by 
NRC?
    Mr. D'Agostino. As you indicated, DNFSB is an advisory agency 
instead of a regulatory authority. This relationship was designed for 
conditions that existed in DOE over 20 years ago. Since that time, 
there have been studies that evaluated the feasibility of the NRC 
regulating DOE/NNSA. The consistent conclusion from those studies has 
been that NRC regulation is technically feasible, but it is unclear 
whether one of the several regulatory models used by the NRC would 
improve safety, improve efficiency, or save money. Given that there is 
no clear conclusion that a change of regulatory model would be an 
improvement, I neither support nor oppose regulation of the NNSA by the 
NRC. I do believe that any decision to change our regulatory approach 
should be preceded by a thorough evaluation of the different regulatory 
models available at the NRC and specifically how they would apply to 
NNSA, and whether there would be clear benefits. I would be reluctant 
to support a change without first identifying the problem the change 
was intended to fix, and being able to demonstrate that the change 
would provide benefits that justified the expense.

    3. Senator Nelson. Mr. D'Agostino, the Secretary of Energy has 
three exemptions to DNFSB recommendations: (1) national security; (2) 
technical reasons; or (3) they are cost prohibitive; and that DNFSB is 
to consider cost as one of its factors but not the sole one. Do you 
believe this is a sound approach?
    Mr. D'Agostino. I believe that our overall approach to responding 
to board advice, and the provisions that enable us to decline their 
advice, if warranted, is sound and is in keeping with our statutory 
responsibility for the safety of our operations.
    As you indicated, there are three bases by which the Secretary of 
Energy can decline a DNFSB recommendation. We consider them when 
responding to a board recommendation, and there have been very few 
cases where the Secretary has rejected a board recommendation, even in 
part. In more than 20 years of oversight by the DNFSB, there have been 
only three recommendations that have been rejected in part (1995-2 on 
integrated safety management; 2011-1 on safety culture; and 2010-1 on 
the standards/regulations covering safety bases).
    Asking the Secretary to reject a safety recommendation, even when 
DOE/NNSA believes that it is appropriate, is not something we undertake 
lightly. Significant internal debate always precedes such an action.

         chemistry and metallurgy research replacement facility
    4. Senator Nelson. Dr. Cook, my understanding is that DOE worked 
with DOD to transfer some $8 billion of budgetary authority over the 
next 10 years to perform a number of tasks, one of which was to 
complete design and begin construction of the Chemistry and Metallurgy 
Research Replacement (CMRR) Facility and commence operations by 2022. 
As part of this transfer, my understanding is that DOE was to plan to 
produce 50 to 80 pits per year in 2022 in the Los Alamos PF-4 facility, 
which makes the plutonium pits. Do you still believe the ability to 
produce 50 to 80 pits per year is a valid requirement?
    Dr. Cook. There were a number of factors DOD and NNSA considered 
that informed the decision to seek a pit production capability of 50 to 
80 newly manufactured pits per year. First, at an unclassified level, 
the best estimate for minimum pit lifetimes in the U.S. stockpile is 85 
to 100 years, and most pits are nearing half that age. There are many 
uncertainties with regard to the pit lifetime estimates and performance 
of aged pits (the details of which are classified) which all support 
the prudent maintenance of a capability to manufacture pits to ensure 
against technological surprise. Furthermore, adding modern safety and 
surety capabilities to the majority of the enduring stockpile will 
require capabilities to remanufacture and rework pits and pit 
components. These factors have not changed, and therefore a pit 
production rate of 50 to 80 pits per year is currently assessed to be a 
prudent, long-term capability to achieve.
    As noted in a letter from the Secretaries of Energy and Defense on 
March 2, 2012, the programmatic modifications made as a result of the 
requirement to operate within the Budget Control Act (BCA) of 2011 
included deferring construction of the CMRR for at least 5 years. We 
plan to employ a strategy of reusing existing pits at a rate of up to 
125 per year and remanufacturing existing pit designs at a rate up to 
20 to 30 pits per year to meet the short- to medium-term needs of 
stockpile life extension programs (LEP). The timeframe to increase pit 
manufacturing capacity will be determined by working closely with DOD, 
and will take into account a number of factors, including cost, future 
stockpile size, and specific LEPs for weapons systems.

    5. Senator Nelson. Dr. Cook, will you have to renegotiate the 2022 
date for making 50 to 80 pits per year based on your decision to defer 
construction of the CMRR Facility?
    Dr. Cook. The timeframe to increase pit manufacturing capacity will 
be determined by working closely with DOD, and will take into account a 
number of factors, including cost, future stockpile size, and specific 
LEPs for weapons systems.

    6. Senator Nelson. Admiral Donald, I understand there is another 
spent fuel facility at the Idaho National Laboratory (INL). Can you 
explain whether this facility can be used in place of the one you are 
designing?
    Admiral Donald. It is important to recognize the reasons underlying 
Naval Reactors' (NR) need for the Spent Fuel Handling Recapitalization 
Project. NR requires a new facility to handle spent nuclear fuel 
because the existing Expended Core Facility (ECF) is over 50 years old, 
does not meet current design standards, and carries escalating risk and 
costs with each year of continued operations. Also, the existing ECF 
does not have the capability to unload full-length aircraft carrier 
fuel from M290 shipping containers.
    At the INL, some naval nuclear fuel is currently stored in Building 
666 at Idaho Nuclear Technology and Engineering Center (INTEC [BL 
666]), but that facility does not meet all necessary spent fuel 
handling requirements. INTEC (BL 666) is not a viable permanent 
replacement for the current ECF, as it lacks the size and capability to 
safely receive, inspect, and process all spent naval nuclear fuel.
    INTEC (BL 666) is also not an acceptable temporary solution for 
many reasons. Primarily, it does nothing to address my long-term need 
for a new facility. Further, with respect to carrier fuel unloading 
capability, most of the water pits in INTEC (BL 666) are incapable of 
receiving full-length aircraft carrier fuel. The two water pits that 
are deep enough will not be empty for several years. Once those water 
pits are free, several hundred million dollars in modifications such as 
rail installation, crane procurement, and high-bay extension would be 
required for conversion to handling aircraft carrier fuel. Even after 
storage and initial processing in INTEC (BL 666), the aircraft carrier 
fuel would still be transported to NRF for inspection and final 
processing for dry-storage in a naval spent fuel canister. Further, 
because of space limitations at INTEC (BL 666), submarine fuel would 
still be handled at another facility.
    On balance, use of INTEC (BL 666) is not cost effective, and does 
not provide me with the long-term spent fuel handling and processing 
capabilities I need to reliably support fleet submarine and aircraft 
carrier needs.
                                 ______
                                 
           Questions Submitted by Senator Joseph I. Lieberman
                             pit production
    7. Senator Lieberman. Mr. D'Agostino and Dr. Cook, U.S. Strategic 
Command (STRATCOM) has a validated requirement for the production of 50 
to 80 plutonium pits per year starting in 2021 as part of the agreement 
between DOD and DOE to transfer some $8 billion in budget authority 
from DOD to DOE for modernization. The director of Los Alamos National 
Laboratory (LANL) has stated that without the CMRR Facility he cannot 
meet that requirement. Do you believe the 50 to 80 pit requirement is 
valid?
    Mr. D'Agostino. There were a number of factors DOD and NNSA 
considered that informed the decision to seek a pit production 
capability of 50 to 80 newly manufactured pits per year. First, at an 
unclassified level, the best estimate for minimum pit lifetimes in the 
U.S. stockpile is 85 to 100 years, and most pits are nearing half that 
age. There are many uncertainties with regard to the pit lifetime 
estimates and performance of aged pits (the details of which are 
classified) which all support the prudent maintenance of a capability 
to manufacture pits to ensure against technological surprise. 
Furthermore, adding modern safety and surety capabilities to the 
majority of the enduring stockpile will require capabilities to 
remanufacture and rework pits and pit components. These factors have 
not changed, and therefore a pit production rate of 50 to 80 pits per 
year is currently assessed to be a prudent, long-term capability to 
achieve.
    As noted in a letter from the Secretaries of Energy and Defense on 
March 2, 2012, the programmatic modifications made as a result of the 
requirement to operate within the BCA of 2011 included deferring 
construction of the CMRR Facility for at least 5 years. We plan to 
employ a strategy of reusing existing pits at a rate of up to 125 per 
year and remanufacturing existing pit designs at a rate up to 20 to 30 
pits per year to meet the short- to medium-term needs of stockpile 
LEPs. The timeframe to increase pit manufacturing capacity will be 
determined by working closely with DOD, and will take into account a 
number of factors, including cost, future stockpile size, and specific 
LEPs for weapons systems.
    Dr. Cook. I agree.

    8. Senator Lieberman. Mr. D'Agostino and Dr. Cook, what steps are 
you taking to try to reduce the expected shortfall in pit production 
capability and what production rate do you aim to achieve?
    Mr. D'Agostino and Dr. Cook. NNSA is assessing a planning 
production rate of 30 pits per year by 2021. NNSA and LANL are 
evaluating capabilities and approaches to support this planning rate 
without CMRR Nuclear Facility (CMRR-NF) (at LANL and elsewhere in the 
enterprise) and what investments are needed to increase capacity at 
LANL's plutonium facility (PF-4).

    9. Senator Lieberman. Mr. D'Agostino and Dr. Cook, do you believe 
that there is any risk that this stated 5-year delay to the CMRR 
Facility will become lengthier or turn into a permanent cancellation?
    Mr. D'Agostino and Dr. Cook. In a time of fiscal austerity, such a 
risk always exists; however, NNSA is committed to being responsible 
stewards of both taxpayers' dollars and the nuclear security 
enterprise. The decision to defer CMRR-NF construction for at least 5 
years and move forward with Uranium Processing Facility (UPF) 
construction is fully consistent with an independent DOD review of both 
projects completed in 2011. As we develop plans for future budgets, 
NNSA will continue to assess the most cost-effective delivery of 
maintaining analytical chemistry, materials characterization, and 
plutonium storage capabilities.

    10. Senator Lieberman. Mr. D'Agostino and Dr. Cook, how would you 
address the pit production shortfall in that event?
    Mr. D'Agostino and Dr. Cook. The administration plans to address 
the manufacturing shortfall by reusing existing pits. For the W76-1 
LEP, we are reusing pits, and our current plans for the B61-12 LEP also 
include pit reuse. NNSA is evaluating the technical viability of 
possible additional pit reuse options for meeting stockpile needs, and 
is working on cost estimates for such a pit reuse capability (which 
would be in addition to manufacturing 30 pits per year) if the reuse 
options require work in LANL's plutonium facility.

                          headquarters funding
    11. Senator Lieberman. Mr. D'Agostino, I noticed a 66 percent 
increase in the fiscal year 2013 NNSA request for headquarters funding 
over the fiscal year 2012 appropriations. Can you describe what 
comprises ``headquarters?''
    Mr. D'Agostino. Funding allocated to headquarters is mainly 
comprised of salaries and related expenses for NNSA Federal employees, 
procurements that occur from our Washington, DC, area offices, legacy 
contractor pension payments, and funding awaiting programmatic 
decisions or competitive solicitation that will ultimately be 
distributed throughout the NNSA and DOE complex during the year of 
execution. For example, the fiscal year 2012 budget request for NNSA 
showed approximately $942 million for headquarters in fiscal year 2012. 
The estimate for fiscal year 2012 in the fiscal year 2013 budget 
request is now $705 million, a reduction of 25 percent, largely 
reflecting solidification of programmatic decisions and the initial 
distribution of the funds from headquarters to NNSA and DOE sites/
contractors. It is anticipated a significant portion of the estimated 
$1,175 million reflected at headquarters in the fiscal year 2013 budget 
request will eventually be allocated to NNSA and DOE sites/contractors 
as well.
    Some examples of the scope associated with the estimated $1,175 
million identified for headquarters are:

         $283 million associated with NNSA Federal salaries and 
        related expenses within the Office of the Administrator 
        appropriation;
         $247 million associated with Legacy Contractor 
        Pensions;
         $150 million associated with the domestic uranium 
        enrichment research, development, and demonstration project 
        within Defense Nuclear Nonproliferation;
         $35 million associated with identification of 
        plutonium storage alternatives within Readiness in Technical 
        Base and Facilities;
         $41 million associated with platform and hardware 
        procurements within the Advanced Simulation and Computing 
        Campaign;
         $30 million associated with implementing the NNSA 
        Network Vision (2NV) Strategy within the NNSA Chief Information 
        Officer Activities program;
         $45 million associated with the DOE Working Capital 
        Fund across all programs; and
         $15 million associated with Minority Serving 
        Institution initiatives across most programs.

    When these procurements are issued, the funding will be spent at 
various locations throughout the NNSA and DOE complex.

    12. Senator Lieberman. Mr. D'Agostino, is any headquarters funding 
directly supporting Weapons Activities, and if so, how much and what 
does it support?
    Mr. D'Agostino. Yes, approximately $626 million is directly 
supporting the Weapons Activities programs. As noted above, much of 
this funding will get distributed to the labs and plants during the 
year of execution.
    The funding identified at headquarters supports the following 
programs:
      
    
    

                        efficiencies initiatives
    13. Senator Lieberman. Mr. D'Agostino, early last year former 
Secretary of Defense Gates announced that he was undertaking an 
efficiencies initiative within DOD to find savings and invest them in 
modernization. I believe that the principles behind Secretary Gates' 
efforts are applicable to other Federal agencies. Have you undertaken 
any efficiencies initiatives within NNSA? If so, please describe them 
and the outcomes they have achieved.
    Mr. D'Agostino. We also believe that the principles behind 
Secretary Gates' efforts are applicable to other Federal agencies. That 
said, NNSA is currently undergoing a governance reform effort in the 
interest of increasing efficiency, eliminating redundancy, and 
reexamining the requirements set to make sure requirements are not 
overly burdensome and facilitate the safe, productive operation of the 
national nuclear security enterprise.
    One of the key undertakings that we are embarking on is balancing 
oversight of safety, security, and business practices while allowing 
flexibility and minimizing intrusive bureaucracy. This will require 
sustained effort on the part of NNSA management and our private sector 
partners.
    NNSA, in partnership with DOE, has been working actively to enhance 
the relationship between the laboratories, sites, and headquarters; to 
enact a series of management reforms intended to improve the way we do 
business; to increase efficiency; and to maintain safe, secure, and 
responsible operations at our sites.
    Here are examples of ongoing efforts at reshaping our relationship:

         The Secretary's ``National Laboratory Director's 
        Council,'' which includes the NNSA Labs, was tasked with 
        identifying Burdensome Requirements for the DOE and NNSA. Of 
        the 28 identified to date by the Lab Directors, 25 have been 
        resolved, 2 are on hold at the request of the Directors, and 1 
        is still being worked.
         The NNSA's Enterprise Operating Requirements Review 
        Board engages Lab and Plant Directors, Site Managers, and 
        Headquarters leadership to look at requirements and directives 
        in order to right-size them.
         The Administrator's NAP-21 ``Transformational 
        Governance and Oversight,'' signed out last year, defined 
        principles, responsibilities, processes, and requirements to 
        help in transforming and improving governance and oversight. We 
        also develop implementation plans for each fiscal year to track 
        performance in meeting the NAP-21's Governance goals.
         To maximize trust, the Administrator has initiated 
        monthly executive video teleconferences including the executive 
        core from labs, plants, and headquarters, and has hosted two 
        off-site retreats.

    We believe that the current contractual arrangements will allow 
NNSA to establish broad program objectives and goals and to capitalize 
on the private sector expertise of our contractors, while giving them 
sufficient flexibility to do their jobs efficiently and while holding 
them accountable for results. We are undertaking the actions described 
above to continuously improve relationships between laboratories, 
sites, and headquarters and to improve the way we do business.

    14. Senator Lieberman. Mr. D'Agostino, do you believe further 
streamlining of NNSA is possible to find further savings to invest 
elsewhere within the agency?
    Mr. D'Agostino. The initial governance reform efforts have achieved 
some significant streamlining in the Site Office and M&O contractor 
interface. A number of DOE directives have been reviewed and some 
balance restored between the degree of oversight and the acceptance of 
risk by the program managers, such as myself and Dr. Don Cook. This 
effort has cleared away some brush so that we can more clearly see 
additional aspects of the problem. Through our governance initiative, 
we are continually seeking additional opportunities to streamline and 
improve the efficiency of our organization. I believe that the savings 
from this approach would not only be in reduced direct Federal staff 
expenses (salaries, travel, training) but also over time in the 
opportunity for staffs at the M&Os to shift to more direct mission 
support activities.
                                 ______
                                 
              Questions Submitted by Senator Jeff Sessions
           memorandum of agreement on stockpile modernization
    15. Senator Session. Mr. D'Agostino, according to the May 2010 
Memorandum of Agreement (MOA) between DOD and DOE on the modernization 
of the U.S. nuclear infrastructure, DOE agreed to fully fund the CMRR 
Facility to complete construction in 2020 and ramp up to a minimum of 
50 to 80 pits per year in 2022. According to the Office of Management 
and Budget budget tables, over the next 10 years DOD will transfer $7.1 
billion in budget authority to NNSA in support of this MOA. Given the 
NNSA budget no longer meets the terms of the DOD/DOE agreement, does 
NNSA intend to return that budget authority back to DOD?
    Mr. D'Agostino. No, the transfer in budget authority is intended to 
assist NNSA in meeting DOD requirements. The decision to defer the 
CMRR-NF for at least 5 years is an adjustment to one element of the 
plans to meet multiple DOD requirements called for in the Nuclear 
Posture Review (NPR) and represents the best use of available Federal 
resources.
    The May 2010 MOA between DOD and DOE on modernization of the U.S. 
nuclear infrastructure delineated funding for a number of important 
efforts defined in the NPR. Beyond the CMRR-NF and pit production 
efforts, the MOA also included the B61 and W78/W88 LEPs, completion of 
W76-1 production, the UPF at Y-12, and the development of capabilities 
for the conduct of future LEPs to increase margin and enhance warhead 
safety, security, and control.
    The program envisioned at the time of the MOA has been revised for 
a number of reasons. The total level of resources available to pursue 
these efforts for fiscal year 2013 and beyond is not what was 
envisioned in fiscal year 2011 and fiscal year 2012 due to the new 
fiscal climate reflected by the BCA. Additionally, the cost of pursuing 
some of these efforts, such as the B61 and W78/W88 LEPs and CMRR-NF, 
increased as planning for these efforts matured. The revised program 
reflected in the President's budget request represents the best use of 
the available Federal dollars and has been coordinated with DOD through 
the Nuclear Weapons Council (NWC). We continue to work with DOD to 
refine cost data on these and other Stockpile Stewardship programs.

    16. Senator Session. Mr. D'Agostino, if NNSA no longer intends to 
honor the terms of the MOA, why should DOD--which the budget proposes 
be cut by $487 billion over the next 10 years--be taxed to supplement 
baseline DOE responsibilities?
    Mr. D'Agostino. Even though recent budgetary constraints have 
certainly caused scheduling changes and adjustments to the original MOA 
project timelines, DOD is still the major beneficiary of these efforts. 
Beyond two major construction projects, the MOA also included the B61 
and W78/W88 LEPs, completion of W76-1, and production and development 
of technologies for the conduct of future LEPs to increase margin and 
enhance warhead safety, security, and control. NNSA will continue to 
work with DOD to meet their requirements while performing within 
available resources.

   chemistry and metallurgy research replacement facility requirement
    17. Senator Session. Mr. D'Agostino, in a question for the record 
from our hearing last year, I asked you to highlight some of the 
consequences for not pursuing the CMRR Facility at Los Alamos. 
Specifically, I asked how a delay in construction would impact both 
future LEP and NNSA's ability to meet existing STRATCOM requirements. 
In response, you said that: ``NNSA will not be able to achieve the 
required 80 pits per-year rate until the new CMRR Facility is in 
operation. This capability is required for the W78 LEP by 2021.'' Is it 
correct that your budget assumes that an 80-pit-per-year rate is no 
longer necessary for the W-78 LEP? If so, what has changed in less than 
1 year to suggest that a capability you told me was once required for 
the W78, now no longer is?
    Mr. D'Agostino. Recent budgetary constraints in the form of the BCA 
have caused NNSA to reevaluate the W78 LEP schedule and the scope of 
the design options for the LEP. As the study has progressed, NNSA has 
become increasingly confident that, at least for the W78 LEP, pits can 
be reused rather than remanufactured. There will certainly be added 
risk as the technical details of reusing pits requires further 
evaluation, but this risk, and the risk of delaying CMRR, were assessed 
to be manageable. Being able to produce 50 to 80 newly manufactured 
pits per year would have allowed us to avoid making the decision to 
accept that risk, but budgetary realities have driven us in a different 
direction. Consistent with this production rate change, we have also 
slipped the schedule for the W78, with the first production unit 
required in 2023 rather than 2021. We believe the decision to push back 
first production on the W78 by 2 years and delay CMRR and the ability 
to produce 50 to 80 newly manufactured pits by 5 years, though not 
ideal, is the most prudent use of our available resources.

    18. Senator Session. Mr. D'Agostino, is it correct that one of your 
justifications for indefinitely deferring CMRR Facility is that you 
assume that new pits will not be required for the W78 LEP and that you 
will be allowed to cannibalize pits currently held in the strategic 
weapons reserve?
    Mr. D'Agostino. The decision to defer CMRR-NF for at least 5 years 
was not driven by assumptions for the W78 LEP. Again, CMRR-NF was never 
intended to produce pits--pit production is within Plutonium Facility 
4--but would provide the analytical chemistry and materials 
characterization necessary to qualify the pits. Deferral was driven by 
budgetary and strategic decisions, as well as the NNSA taking the 
opportunity to utilize existing infrastructure, ie: Radiological 
Laboratory, Utility, and Office Building (RLUOB) under the modern dose 
conversation factors which increased the amount of plutonium we could 
characterize in the new lab.
    Our W78 Life Extension Study, Phase 6.1, concept study includes pit 
production and reuse options to evaluate program cost, ability to meet 
design requirements, and production capability. All three of these 
constraints will factor into our final decision on newly produced or 
reuse pits. At this phase, we have not made any assumptions but, we 
must consider the budget, and therefore production, constraints we are 
facing regarding pits.

    19. Senator Session. Mr. D'Agostino, has DOD, the NWC, or the White 
House made a policy decision that the only option to be considered for 
the W78 is the reuse of pits currently held in the strategic hedge? If 
not, is your decision to indefinitely defer CMRR Facility limiting the 
options of future policy decisions?
    Mr. D'Agostino. To date, we continue to follow the policy outlined 
in the 2010 NPR report to look at reuse, refurbishment, and replacement 
options to ensure the labs have maximum flexibility and the full range 
of options. We have not received any external policy decisions 
regarding limiting pit options for the W78/88 common warhead. NNSA is 
conducting analysis to determine how we can increase our planned 
capacity for remanufacturing war reserve pits. We will retain options 
for pit reuse up to 125 per annum and remanufactured pits up to 20 to 
30 per annum. We believe that this set of options will enable the W78/
88 LEP to be conducted effectively.

    20. Senator Session. Mr. D'Agostino, am I correct in understanding 
that the most recent NPR states the full range of LEP approaches will 
be considered, including the replacement of nuclear components?
    Mr. D'Agostino. Yes, while the NPR is clear that the United States 
will give preference to nuclear component refurbishment or reuse, it is 
equally clear that the full range of options will be considered for 
each warhead LEP, including replacement of nuclear components. As noted 
in their April 9, 2010, statement on the NPR, the laboratory directors 
affirmed that this approach ``provides the necessary technical 
flexibility to manage the nuclear stockpile into the future with an 
acceptable level of risk.''

    21. Senator Session. Mr. D'Agostino, in another question for the 
record from our last hearing less than 1 year ago, I asked you how a 
delay in CMRR Facility could impact future LEPs. In response you 
stated: ``the safety, security, and environmental issues associated 
with the aging existing facilities are mounting, as are the costs of 
addressing them . . . in the event that [existing] facilities had to be 
shut down due to safety, security, or environmental concerns, the loss 
of workforce and critical skills would be considerable, and it would 
likely be extremely expensive to restart operations.'' What 
requirements have changed in less than 1 year to justify the indefinite 
deferral of CMRR Facility?
    Mr. D'Agostino. The BCA required difficult program choices, 
including the deferral of CMRR-NF construction for at least 5 years. I 
would note that the question for the record you reference from last 
year concerned not only CMRR-NF, but UPF, which is being accelerated to 
address the risks you cite. The decision to defer construction of the 
CMRR-NF still provides for the planned orderly phase-out of program 
activities from the CMR building, concluding in approximately 2019. 
During the deferral period for CMRR-NF construction, NNSA is focused on 
ensuring our plutonium needs are met by using the capabilities and 
expertise found at existing facilities. Maximizing use of existing 
facilities will allow us to ensure uninterrupted plutonium operations 
while focusing on other key modernization projects. While this path is 
not ideal, and likely not sustainable for the long-term, the risk to 
plutonium operations was assessed to be manageable--though NNSA is 
examining where additional investments are required for this strategy 
to be execute successfully. More broadly, this plan was assessed to be 
the most prudent path forward given budget constraints.

                      cost of nuclear construction
    22. Senator Session. Mr. D'Agostino, as I mentioned in my opening 
remarks, indefinitely deferring the facility at Los Alamos while also 
increasing funding for the multibillion dollar facility at Y-12 sends 
the wrong message. It perpetuates the status quo mentality that 
everything nuclear has to be cost prohibitive. It also validates the 
out-of-control risk aversion that has ballooned cost. As of March 2012, 
how much to date has been spent on studying and designing the CMRR 
Facility?
    Mr. D'Agostino. A decision has been made to defer CMRR-NF 
construction for at least 5 years, but not indefinitely. Through March, 
the CMRR project has spent approximately $362 million on design of the 
NF to reach a design maturity of approximately 80 percent. Closing out 
NF design efforts in fiscal year 2012 will inform future projects by 
improving the application of safety requirements in the design of 
nuclear facilities and enhancing our understanding of the seismology at 
Los Alamos. A part of the CMRR project, the RLUOB, is now complete and 
preparing for finishing equipment installation and beginning operations 
in fiscal year 2013.

    23. Senator Session. Mr. D'Agostino, as of March 2012, what are the 
current cost estimates for the UPF at Y-12?
    Mr. D'Agostino. The current cost range for the UPF is $4.2 to $6.5 
billion as reported in the construction Project Data Sheet. The project 
baseline for cost and schedule will be established at Critical 
Decision-2 which is scheduled for the end of fiscal year 2013.

    24. Senator Session. Mr. D'Agostino, what specific steps are you 
taking to ensure affordability?
    Mr. D'Agostino. NNSA has, and will continue to have, external 
reviews that evaluate project cost-saving opportunities as the design 
matures. To ensure the costs of the UPF project remain affordable, NNSA 
is in the process of revising the execution plan to construct the 
building and support systems and phase installation of process 
equipment according to a priority of the processes at greatest risk of 
failure. Moving capabilities out of Building 9212 are of the highest 
priority.

    25. Senator Session. Mr. D'Agostino, what cost-savings measures 
have you considered?
    Mr. D'Agostino. The project has an ongoing effort to seek 
opportunities to reduce costs without compromising safety, security, 
and continuity of capability. To name a few, the project is exploring 
options in project acquisition, technology development, reduction of 
existing security areas, and optimization of phases of construction.
    NNSA has recently created the Office of Acquisition and Project 
Management which is an independent organization that combines critical 
elements of project execution oversight and is dedicated to ensuring 
that costs and schedules are validated and maintained through the life 
of a project. Under this new project oversight strategy, NNSA has 
emphasized that construction contractors for all construction projects, 
including UPF, are accountable to meet milestones, deliverables, safety 
and security elements, and cost with annual monetary incentives. In 
addition, NNSA has hired a new Federal Project Director, John 
Eschenberg, to lead the design and construction efforts for the Y-12-
based UPF in Oak Ridge.

    26. Senator Session. Mr. D'Agostino, are there any cost-savings 
measures you haven't considered because of government regulation or 
legislative restrictions?
    Mr. D'Agostino. NNSA has not eliminated any cost-saving measures 
from consideration due to government regulation or legislative 
restrictions, and continues to seek cost-savings opportunities.

    27. Senator Session. Mr. D'Agostino, given your proposal to 
indefinitely defer CMRR Facility, what steps will you take to ensure 
that the hundreds of millions of dollars that were spent designing this 
facility will not go to waste?
    Mr. D'Agostino. Through March, $32 million has been spent on design 
of the CMRR-NF. The CMRR-NF design will continue until the project 
achieves a substantially complete design in 2012. The decision whether 
or not to construct the CMRR-NF has yet to be made. The strategy for 
CMRR-NF is to defer construction for at least 5 years. Closing out NF 
design efforts in fiscal year 2012 will inform future projects by 
improving the application of safety requirements in the design of 
nuclear facilities and enhancing our understanding of the seismology at 
Los Alamos. Moreover, the CMRR-NF design and other alternatives will be 
evaluated over the next 5 years to determine the most effective 
approach to sustain the plutonium capability.

                         new plutonium strategy
    28. Senator Session. Mr. D'Agostino and Dr. Cook, in your prepared 
statement you state that the decisions made were in ``close 
consultation with our national laboratories and national security 
sites.'' However, I understand that it was not until the day of the 
budget release that NNSA sent a memo to Los Alamos informing them of 
the decision to cancel the CMRR Facility and requesting that they 
develop a plan within 60 days for implementing a new NNSA plutonium 
strategy. I understand this new strategy will utilize a number of 
various facilities, some of which will require additional investments 
to prepare, and will require the shipment of plutonium across a large 
portion of the southwest. Some estimate that your alternative plutonium 
strategy will cost at least $500 million over the next 5 years. As of 
March 2012, has a cost benefit analysis taken place confirming that the 
long-term cost implications of deferring CMRR Facility over the next 5 
years will be significantly less than the costs of pursing an 
alternative strategy?
    Mr. D'Agostino. NNSA tasked LANL to develop high-level plans to 
evaluate the implications for our plutonium capability in the event 
that construction of the CMRR-NF was delayed, considering several 
options and alternatives. Although preliminary estimates of cost for 
options and alternatives are under development for consideration, as of 
March 2012, no cost benefit analysis has been completed, and NNSA will 
continue to evaluate costs of alternatives and options with LANL 
through the fiscal year.
    Dr. Cook. Planning actions were underway in late 2011 regarding 
options for the B61-12 LEP, the UPF, and the CMRR-NF, once the BCA of 
2011 was passed. The letter requesting formal planning and evaluation 
by LANL was released as soon as the President's budget request for 2013 
was no longer embargoed.

    29. Senator Session. Mr. D'Agostino and Dr. Cook, as of March 2012, 
what studies have taken place to validate that the new proposed plan is 
viable?
    Mr. D'Agostino. NNSA tasked LANL to develop high-level plans to 
evaluate the implications for our plutonium capability in the event 
that construction of CMRR-NF was deferred, considering several options 
and alternatives. As of March 2012, NNSA has not dispositioned, 
selected, or validated the viability of any option or alternative, but 
will continue to work towards a preferred alternative and assess 
viability throughout the fiscal year.
    Dr. Cook. I agree.

    30. Senator Session. Mr. D'Agostino and Dr. Cook, as of March 2012, 
can you certify today that the cost of implementing the new strategy 
will be cheaper and safer than the cost of proceeding with CMRR 
Facility?
    Mr. D'Agostino. Total cost impacts associated with deferral of NF 
construction are not known at this time. As NNSA moves forward with the 
analysis of recommendations from LANL to provide for CMRR-NF 
capabilities using existing infrastructure, it will weigh recommended 
options against current fiscal realities. NNSA always considers nuclear 
safety as a high priority in all aspects of the enterprise to include 
plutonium production.
    Dr. Cook. I agree.

    31. Senator Session. Mr. D'Agostino and Dr. Cook, I understand that 
the budget does not include funding to increase PF-4 capacity from 11 
per year to the 20 to 30 claimed by the administration, is that 
correct?
    Mr. D'Agostino. Yes. The fiscal year 2013 President's budget 
includes a minimum sustainment profile to support the manufacturing 
process transition from W88 pits to W87 pits, but not any funding to 
increase capacity.
    Dr. Cook. I agree.

    32. Senator Session. Mr. D'Agostino and Dr. Cook, do we know for 
certain if pits stored at Pantex can be reused or how much it will cost 
to make that determination?
    Mr. D'Agostino. Yes, we do know for certain that some of the pits 
stored at Pantex can be reused. The cost for reuse in a particular 
weapon and certification of pit reuse options in a LEP depend on the 
design of the LEP. The total cost for certification of existing pits in 
new systems has not yet been determined. Without completing a 6.2/2a 
study, the cost for certification of a remanufactured pit into a new 
system would also be undetermined.
    Dr. Cook. I agree.

    33. Senator Session. Mr. D'Agostino and Dr. Cook, is it true that 
the budget does not include funding to analyze this?
    Mr. D'Agostino and Dr. Cook. The budget does include funding which 
will allow for preliminary evaluation of technical options and 
associated costs. These results will be reflected in the 2014 and 
subsequent budget requests.

                    issues with a pit reuse strategy
    34. Senator Session. Mr. D'Agostino and Dr. Cook, is it true that 
old pits generally do not meet some modern requirements and that 
existing pits typically considered for reuse are already between 20 and 
50 years old?
    Mr. D'Agostino. Existing pits that are candidates for reuse span a 
variety of ages. Not all of the existing pit types are the best 
candidates for future LEP designs. However, this is more due to 
physical characteristics (e.g., the fact that they have been designed 
to function using conventional high explosive rather than designed for 
insensitive high explosive) and not their age. We have several existing 
pit types that are viable to meet requirements for modernized LEP 
designs.
    Dr. Cook. I agree.

    35. Senator Session. Mr. D'Agostino and Dr. Cook, is it true that 
there are a fixed number of existing pits and pit types and that not 
every pit type is compatible with every weapons system type?
    Mr. D'Agostino. It is true that there is a finite quantity of 
existing pits and pit types. Not every existing pit type is a candidate 
for reuse to modernize existing systems.
    Dr. Cook. I agree.

    36. Senator Session. Mr. D'Agostino and Dr. Cook, is it true that 
there is a risk that an approach to mix and match pits and weapon types 
could exhaust the available supply of a given pit type, limiting 
stockpile options?
    Mr. D'Agostino. We continue to review the viability of pit designs 
to support future reuse and modernization of the stockpile. Our 
analysis includes the quantities necessary to support the full scope of 
a LEP including sufficient quantities to support system qualification 
and destructive evaluation for an associated stockpile evaluation 
program. When we consider reuse and refurbishment options, we include 
in the analysis the flexibility and additional capability to produce 
prior designs at the level of 20 to 30 new pits annually.
    Dr. Cook. I agree.

                   national academy of sciences study
    37. Senator Session. Mr. D'Agostino, in a recently published study 
authorized by this committee in the National Defense Authorization Act 
(NDAA) for Fiscal Year 2010, the National Academy of Sciences 
characterized the relationship between NNSA and the weapons labs by a 
persistent level of mistrust exacerbated by poor communications and 
lack of transparency at the highest levels. Do you agree with the 
study?
    Mr. D'Agostino. We are continuing our efforts to reduce 
administrative burdens and increase transparency, and therefore 
building trust through governance reform. We are committed and 
energized to continue to make improvements in NNSA oversight efforts 
and in rebuilding trust in the NNSA/laboratory relationship.

    38. Senator Session. Mr. D'Agostino, what do you believe should be 
done to overcome the issues raised in the study?
    Mr. D'Agostino. One of the key undertakings that we are embarking 
on is balancing oversight of safety, security, and business practices 
while allowing flexibility. This will require sustained effort on the 
part of NNSA management and our private sector partners.
    NNSA, in partnership with DOE, has been working actively to enhance 
the relationship between the laboratories, sites, and headquarters to 
improve the way we do business; to increase efficiency; and to maintain 
safe, secure, and responsible operations at our sites.
    We believe that the current contractual arrangements will allow 
NNSA to establish broad program objectives and goals and to capitalize 
on the private sector expertise of our contractors, while giving them 
sufficient flexibility to do their jobs efficiently and while holding 
them accountable for results. We are undertaking the actions to 
continuously improve relationships between laboratories, sites, and 
headquarters and to improve the way we do business.

                        improving relationships
    39. Senator Session. Mr. D'Agostino, one key recommendation of the 
bipartisan Strategic Posture Commission (SPC) focused on the current 
NNSA governance structure and the determination that it is ``not 
delivering the needed results.'' To address this shortfall, the SPC 
recommended that Congress should amend the NNSA Act to ``establish the 
NNSA as a separate agency reporting to the President through the 
Secretary of Energy.'' Do you agree with the SPC's findings? If yes, 
how do you believe we should reform NNSA governance? If not, why not?
    Mr. D'Agostino. We are investigating ways to reduce the 
administrative burden and increase flexibility for management and staff 
operating our mission facilities. NNSA has, however, faithfully 
delivered on all national security requirements, and will continue to 
do so through any transition in governance structure.
    We believe that the current contractual arrangements will allow 
NNSA to establish broad program objectives and goals and to capitalize 
on the private sector expertise of our contractors, while giving them 
sufficient flexibility to do their jobs efficiently and while holding 
them accountable for results. We are undertaking the actions described 
above to continuously improve relationships between laboratories, 
sites, and headquarters and to improve the way we do business.

                        environmental management
    40. Senator Session. Mr. D'Agostino and Mr. Huizenga, the fiscal 
year 2013 request for Environmental Management (EM) is $5.49 billion, 
almost $500 million more than the level appropriated in fiscal year 
2012. Given EM funding is a part of security spending, how do you 
justify large increases for EM and a $371 million reduction from the 
funding level planned for fiscal year 2013 in the fiscal year 2012 
budget for the weapons program? It appears to me that national security 
requirements are being traded for environmental cleanup.
    Mr. D'Agostino and Mr. Huizenga. The fiscal year 2013 request for 
the Defense Environmental Cleanup account is $5.49 billion. This amount 
includes $463 million that would be transferred from the General Fund 
to be deposited into the Uranium Enrichment Decontamination and 
Decommissioning Fund--netting to zero in the request. There is no 
programmatic increase of $463 million. The total fiscal year 2013 
request for the EM program is $5.65 billion, which is a reduction of 
$60 million from the fiscal year 2012 enacted level of $5.71 billion.

    41. Senator Session. Mr. D'Agostino and Mr. Huizenga, a January 
2012 front page USA Today article on the cleanup project at Hanford 
painted a very troubling picture of the decade-long, multi-billion-
dollar symbol of what is wrong with the EM program. According to the 
article, the Waste Treatment Plant's (WTP) $12.3 billion price tag is 
not only triple original estimates but is ``well short of what it will 
cost to address the problems and finish the project.'' What will it 
cost and how much more time will it take to finish this project?
    Mr. D'Agostino and Mr. Huizenga. Today, the WTP Project is over 62 
percent complete, and DOE has directed the WTP Project contractor to 
develop a Baseline Change Proposal projecting the total project costs 
and schedule for completing the capital project. This proposal should 
be completed by the fall of 2012. Until we receive the Baseline Change 
Proposal from the contractor, and conduct our own independent 
government cost estimate that will serve as the basis for the 
independent review of that proposal, we are unable to address potential 
cost and schedule changes. DOE remains committed to working with 
Congress and its stakeholders to complete this important project and 
reduce the risk posed by the tank waste at Hanford.

    42. Senator Session. Mr. D'Agostino and Mr. Huizenga, given the 
complexity of a high-risk, one-of-a-kind NF, why was a design-build 
approach--which a Government Accountability Office official quoted as 
being ``good, if you're building a McDonald's''--taken?
    Mr. D'Agostino and Mr. Huizenga. DOE selected a design-build 
approach because it vests a single contractor with the responsibility 
to design, build, and commission the WTP under a single contract. One 
entity is clearly responsible to assure the adequacy of design to meet 
project performance expectations; to assure construction meets design 
specifications; and to demonstrate, through commissioning, that 
performance expectations are met. Another reason that a design-build 
strategy was selected was that this approach allowed facilities to be 
completed and commissioned earlier, meeting stakeholder desires to 
begin processing waste as soon as possible. At the time the decision 
was made to apply the design-build strategy to the WTP, no one 
anticipated that the resolution of the technical issues would be so 
complex. If DOE were presented with the same decision now with the 
current level of knowledge, a key consideration would focus on the 
development of a plan for closing the technical issues and validating 
design.

    43. Senator Session. Mr. D'Agostino and Mr. Huizenga, who is being 
held accountable for this project?
    Mr. D'Agostino and Mr. Huizenga. Accountability for the successful 
completion and operation of the WTP Project extends to all levels of 
DOE. This project has the attention of and support from the most senior 
levels in DOE, and I assure you that they have clearly communicated 
their expectations and hold me and my management team--which extends 
down to the Federal Project Director of the WTP--accountable for safely 
and successfully completing this project.

    44. Senator Session. Mr. D'Agostino and Mr. Huizenga, why shouldn't 
this project be terminated immediately or stopped to evaluate whether 
the current plan is affordable?
    Mr. D'Agostino and Mr. Huizenga. The safe cleanup of the 56 million 
gallons of chemical and radioactive waste stored in underground tanks 
at the Hanford Site in Washington State, only 7 to 10 miles from the 
Columbia River, is one of the highest priorities for the Office of EM's 
mission. This waste, the legacy of DOE's plutonium production mission 
for the national defense, is highly complex, and is currently stored in 
tanks that are decades beyond their design life. The WTP Project is the 
cornerstone of EM's cleanup strategy, and it is of utmost importance 
that we continue to move forward to get this solution in place and 
operating to reduce the risk posed by Hanford's tank waste. Today, the 
WTP Project is over 62 percent complete, and there is unmistakable 
physical progress toward accomplishing the tank waste cleanup mission 
at Hanford.

    45. Senator Session. Mr. D'Agostino and Mr. Huizenga, in 2005, 
Senator Graham was able to speed up cleanup at the Savannah River Site 
(SRS) by 23 years and save taxpayers $16 billion. Section 3116 of the 
2005 NDAA illustrates that there are, in fact, vehicles and legislative 
options for reducing both cost and schedule of environmental cleanup 
programs. What over the past year has EM done to address the staggering 
and growing cost of cleanup and what can Congress and the executive 
branch do to make sure that we get the job done without spending such a 
staggering amount of taxpayers' dollars?
    Mr. D'Agostino and Mr. Huizenga. The Office of EM continues to use 
a risk-informed decisionmaking process to set priorities and, working 
with our regulators, establish cleanup standards that are protective of 
human health and the environment. EM also continues to incorporate 
efficiencies into the processes used to complete environmental 
remediation at all of the DOE sites. This is attained by developing new 
technologies to address highly complex technical issues and 
implementing contract strategies that achieve more cost-effective 
cleanup while maintaining high safety standards.
    Section 3116 has saved costs and reduced schedule in DOE's high-
level waste tank closure efforts at SRS and INL. Using this waste 
determination process, DOE has closed at INL, 11 large tanks (300,000 
gallons), and 4 small tanks (30,000 gallons), and at SRS, low activity 
radioactive waste is being disposed of as saltstone in onsite vaults 
and the closure process for the F Tank Farm, specifically, Tanks 18 and 
19, began in April 2012.
    At Oak Ridge, we have reevaluated the disposition of U-233 at the 
Oak Ridge National Laboratory. In the first phase of the U-233 project, 
approximately half of the inventory is being shipped directly without 
processing to the Nevada National Security Site for disposal or storage 
for future programmatic use. This alternative strategy significantly 
reduces the capital asset requirements for the project and is estimated 
to avoid hundreds of millions of dollars from the previous project cost 
estimate.
    Using funds from the American Recovery and Reinvestment Act of 
2009, EM has accelerated decommissioning and deactivation of excess 
facilities and cleanup of contaminated areas to reduce the legacy 
cleanup from over 900 square miles in 2009 to 318 square miles by the 
end of fiscal year 2011; significantly below the end of the fiscal year 
2011 target of 540 square miles. EM is using cost-effective processes 
such as entombment of reactors to reduce the inventory of excess 
facilities. The continued management and removal of legacy transuranic 
waste from generator sites will directly support risk reduction and aid 
in the goal of reducing site footprint.
    EM continues to implement sustainable remediation remedies and to 
explore new technologies that are more effective and efficient. EM is 
continuing to look at using monitored natural attenuation and enhanced 
attenuation to remove contaminants from groundwater, therefore 
eliminating constructing and operating pump and treat systems, which 
generally must operate for long periods of time, thereby reducing 
costs. EM is also using new types of impermeable barriers to reduce the 
spread of contamination in the subsurface, further reducing the cost to 
remediate groundwater. At West Valley, NY, an 860-foot-long and 30-
foot-deep impermeable barrier was installed to prevent the spread of 
strontium. At SRS, a gate and funnel type barrier was used to funnel 
the groundwater into an area where it can be treated. At Hanford, EM is 
using a new treatment material (resin) to remove chromium from the 
groundwater. The use of this new resin removes about 15 times the 
amount of chromium, therefore reducing the operating costs associated 
with resin change out.
    For high level waste, EM is investing in technologies to improve 
glass formulation to increase the amount of radionuclides that can be 
incorporated into glass at Hanford's WTP. EM is also developing a small 
column ion exchange (SCIX) to be coupled with a rotary microfilter to 
pretreat the radioactive tank waste at SRS and Hanford. Since 2008, EM 
has been employing at SRS the Caustic-Side Solvent Extraction process 
for removing radioactive cesium-137 from waste in a modular unit, and 
will be implementing it at full scale at the SRS's Salt Waste 
Processing Facility. The next-generation chemistry promises to be 
transformational in its impact, especially when coupled with SCIX. 
These technology advances accelerate waste processing to shorten the 
schedule and reduce cost.
    The EM program is large and complex. Many of the problems require 
unique solutions to address the cleanup. EM will continue to find 
innovative ways to address these problems, reduce risks, maintain 
safety, and be protective of human health and environment while 
continuing to explore innovative ways to reduce the cost.

                    ssbn(x) life-of-the-hull reactor
    46. Senator Session. Admiral Donald, what is the current technology 
readiness level for the life-of-the-hull reactor anticipated for the 
SSBN(X)?
    Admiral Donald. The reactor for Ohio replacement will incorporate 
technologies proven over the last 30 years that provide greater energy 
and a longer lifetime than any previous submarine core.
    Development of the materials required to achieve the life-of-ship 
core were part of previous research, design, and manufacturing efforts 
that NR is evaluating today. The knowledge gained from these efforts 
identified the additional steps needed to be ready for full-scale 
production in support of Ohio replacement. NR is confident in the 
ability of the material to support the life-of-ship core and will 
validate through manufacturing demonstrations as part of efforts 
supporting the Land-Based Prototype Refueling Overhaul.
    While NR has not historically used technology readiness levels to 
manage its technical efforts, the program judges that the life-of-ship 
core material technology would represent a level 5 (component and/or 
breadboard validation in a relevant environment). This assessment is 
based on the fact that a prototype test cell incorporating the new 
material has been inserted in an operating, land-based, reactor plant. 
Manufacturing development at the ship-production scale needs to be 
demonstrated, and will be derisked as part of the Land-Based Prototype 
Refueling Overhaul.

    47. Senator Session. Admiral Donald, how are the requirements for 
the life-of-the-hull reactor design for SSBN(X) different from those in 
current Virginia-class submarines?
    Admiral Donald. SSBNs spend more time at sea than SSNs in order to 
meet the requirements for strategic patrols and therefore are operated 
by two distinct crews. Ohio replacement will also be designed for a 
life of 42 years, vice 33 for Virginia. The Ohio replacement core will 
operate at sea for more than twice as many days as Virginia's core. In 
order to achieve this increase in energy and lifetime demand, NR is 
designing a core with new materials to support the increased demands.

    48. Senator Session. Admiral Donald, I understand that the current 
milestone and decision point for determining the technical feasibility 
of developing a life-of-the-hull reactor for the SSBN(X) will occur 
this year. Are those studies on track?
    Admiral Donald. Yes. Based on the materials analysis work completed 
to date, NR is in the process of evaluating a recommendation from its 
prime contractor laboratory to verify that the technology is 
sufficiently mature for inclusion in the Ohio replacement core design. 
Continued funding will be necessary to refine the Ohio replacement core 
design and manufacturing capabilities as the core vendor increases to a 
production scale and ensure that our projections regarding 
manufacturing capability and core performance remain valid.

    49. Senator Session. Admiral Donald, do you foresee any significant 
hurdles which could preclude your ability to develop a life-of-the-hull 
reactor for the SSBN(X)?
    Admiral Donald. The funding levels for the Ohio replacement reactor 
plant design and the associated work in the Land-Based Prototype 
Refueling Overhaul in the President's budget for fiscal year 2013 for 
fiscal years 2014 to 2017 are placeholders. The administration is 
currently conducting the analysis required to develop a profile that 
not only provides sufficient resources for Ohio replacement and the 
Land-Based Prototype, but also meets the requirements of the BCA. If 
the profile is funded from fiscal year 2014 and beyond, we do not see 
any insurmountable technical hurdles.

    50. Senator Session. Admiral Donald, if it is determined that a 
life-of-the-hull reactor for the SSBN(X) is not possible, how will that 
impact the overall number of boats required to meet STRATCOM's 
requirements? In other words, would additional boats be required to 
compensate for refueling?
    Admiral Donald. With adequate funding, NR expects to deliver a 
life-of-ship core for Ohio replacement. Without a life-of-ship core 
though, two additional ships, at a cost of at least $10 billion, would 
be required to meet STRATCOM's requirements due to the decreased 
availability of the class during refuelings.

                   priorities regarding cmrr and upf
    51. Senator Session. Mr. D'Agostino and Dr. Cook, according to the 
SPC report, four factors should be assessed when determining if CMRR 
Facility or UPF is of greatest need. While the SPC concluded that 
funding both would ``best serve the national interest,'' they stated 
that if a decision were made to put one before the other, then CMRR 
Facility at Los Alamos should take precedence. According to SPC:

          A short-term loss of plutonium capabilities may hurt 
        the weapons program more than a short-term loss of enriched 
        uranium capabilities.
          The Los Alamos plutonium facility makes a direct 
        contribution to maintaining intellectual infrastructure that is 
        in immediate danger of attrition.
          Because the future size of the stockpile is 
        uncertain, projects that are relatively independent of 
        stockpile size should take priority . . . [and] the Los Alamos 
        plutonium facility and required independent of stockpile size.

    Given the fiscal year 2013 budget decision to forgo the plutonium 
facility at Los Alamos, perhaps indefinitely, why does the 
administration proposal, once aligned with SPC, now contradict some of 
the key findings?
    Mr. D'Agostino. CMRR-NF construction is deferred for at least 5 
years. The decision to defer CMRR-NF construction and move forward with 
UPF construction is fully consistent with an independent DOD review and 
recommendations for both projects completed in 2011. The decision to 
accelerate the UPF project was made because NNSA and DOE concurred with 
DOD's independent view that Building 9212 at Y-12 presents the highest 
program and operational risk. In addition, all three weapons laboratory 
directors were consulted frequently during the NNSA budget formulation 
process, and reflects their recommendations. While the SPC Report 
provides an excellent analysis of America's Strategic Posture, it was 
published in 2009; prior to the BCA and revised project cost estimate 
ranges for both CMRR-NF and UPF. Based on input from stakeholders and 
reflecting increased fiscal austerity, NNSA decided to defer 
construction of the CMRR-NF for at least 5 years.
    Dr. Cook. I agree.

    [Whereupon, at 4:42 p.m., the subcommittee adjourned.]


DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 
               2013 AND THE FUTURE YEARS DEFENSE PROGRAM

                              ----------                              


                       WEDNESDAY, MARCH 21, 2012

                               U.S. Senate,
                  Subcommittee on Strategic Forces,
                               Committee on Armed Services,
                                                    Washington, DC.

                        MILITARY SPACE PROGRAMS

    The subcommittee met, pursuant to notice, at 2:33 p.m. in 
room SR-222, Russell Senate Office Building, Senator E. 
Benjamin Nelson (chairman of the subcommittee) presiding.
    Committee members present: Senators Nelson and Sessions.
    Committee staff member present: Leah C. Brewer, nominations 
and hearings clerk.
    Majority staff member present: Jonathan S. Epstein, 
counsel.
    Minority staff member present: Daniel A. Lerner, 
professional staff member.
    Staff assistant present: Hannah I. Lloyd.
    Committee members' assistants present: Ryan Ehly, assistant 
to Senator Nelson; and Lenwood Landrum, assistant to Senator 
Sessions.

   OPENING STATEMENT OF SENATOR E. BENJAMIN NELSON, CHAIRMAN

    Senator Nelson. Senator Sessions is on the way, but we will 
go ahead and start and then when he gets here, he will give his 
opening statement.
    So let me today call our hearing to order.
    The purpose of today's hearing is to receive testimony on 
the Department of Defense's (DOD) fiscal year 2013 budget 
submission for its space activities.
    First, let me thank today's witnesses for appearing before 
the subcommittee. I know you are all busy and this subcommittee 
very much appreciates the time that you are taking to testify.
    Let me note that sitting at the table and not behind me, as 
she once did, is Assistant Secretary Madelyn Creedon. Our 
committee misses you very much. Welcome back, Madelyn. It is 
good to have you. Congratulations again on your new position.
    The President's fiscal year 2013 request for DOD space 
programs totals about $9.7 billion, down roughly 17 percent 
from fiscal year 2012. The decrease mainly represents the 
completion and launch of several large satellites that were 
under development in prior years. So for the first time in many 
years, DOD has more satellites than launch capacity, indicating 
that we seem to be overcoming several major acquisition 
challenges in DOD's space programs. However, there are still 
several concerns that I have that I hope we can discuss to 
inform this subcommittee as we begin drafting our annual 
defense authorization bill.
    First and foremost is the way forward with our Evolved 
Expendable Launch Vehicle (EELV) program. Last fall, there was 
a critical Government Accountability Office (GAO) report on the 
program's costs growth and the ability to let in new and 
innovative launch providers for competition to drive down cost 
without sacrificing our mission assurance.
    Second, while we are now launching satellites into space on 
a regular basis, we are failing to effectively utilize some of 
them here on Earth.
    The Space-Based Infrared Satellite (SBIRS) after many 
delays and cost overruns is delayed in implementing its ground 
system. The Navy's Mobile User Objective System (MUOS) 
satellite does not have terminals that effectively use the 
satellite's new frequencies.
    The Advanced Extremely High Frequency (AEHF) satellite 
seems to win the prize with a signal so advanced that it has 
caused the cancelation of the ground system that was to use it, 
the Family of Advanced Beyond Line-of-Sight Terminals (FAB-T). 
This cancelation has in turn affected our Air Force strategic 
bombers' ability to have nuclear hardened, high data rate 
communications with the satellite. The AEHF's new waveform also 
caused a cancelation in the Air Force's ground element of their 
Minimum Essential Emergency Communications Network (MEECN). I 
will be asking each of the witnesses and the GAO about this 
issue and what we might do in future programs to avoid it.
    Third, I understand that somehow in this budget we managed 
to cancel two small but highly significant programs that have 
been paving the way forward on space innovation with low cost 
but responsive satellites.
    The first program, the Space Test Program, was a $50 
million a year effort that General Schriever himself, the 
father of DOD Space, established in 1965 to provide a means to 
launch innovative and high-risk satellites. This small program 
led to groundbreaking satellites such as the Global Positioning 
System (GPS), our first secure communications system called 
MILSTAR, and finally our defense weather satellites. More 
importantly, it has served as the venue for students at our 
universities and military academies to launch and control 
innovative satellites. Many of these same students who got 
excited about space from this program are today's military 
space leaders.
    The second program is the Operationally Responsive Space 
(ORS) program whose purpose is to develop innovative low-cost 
and responsive satellites that are designed for tactical use by 
our battlefield commanders and, if necessary, to rapidly 
reconstitute our satellite system if it were to be disabled. I 
understand that ORS-1 was developed from start to finish in 
less than 3 years for a fraction of the cost of normal imagery 
payloads and is being tasked directly by U.S. Central Command 
rather than through the traditional tasking processes.
    I would like to know how the Air Force came to this 
decision and whether they understand its full impact. I 
understand the Army has begun to experiment with small tactical 
payloads as well. So I look forward to their testimony here to 
compare and contrast what happened to these two programs.
    The third issue is what DOD is going to do about preserving 
its allocated radio frequency spectrum. We nearly lost a DOD 
block of spectrum as a pay-for in a recent tax bill and this 
committee worked very hard to avert what many in DOD saw as a 
crisis. I would ask consent to enter into the record a letter 
dated February 3, 2012, on this issue from the Deputy Secretary 
of Defense, Ashton B. Carter.
    [The letter and information paper of Secretary Carter 
follows:]
      
    
    
      
    
    
      
    
    
      
    
    
    Senator Nelson. It details clearly the impact of losing 
portions of the frequency spectrum that DOD currently uses. I 
will be asking each of you about this topic to ensure its 
importance is known to our committee members.
    Fourth and finally, I would like to learn about how we are 
coordinating space activities both within the United States and 
internationally. Madelyn, this is your area. I would like to 
know where we are with the code of conduct for space. There are 
concerns amongst some members that we are taking actions that 
resemble a treaty. I know treaties are the realm of the 
Department of State (DOS), but DOD must have views on the 
implications of this code of conduct on its space operations. 
It may not be a treaty, but as you well know, it will establish 
international norms amongst nations.
    Within the United States, I would like to know what we are 
doing to coordinate our space efforts with the Missile Defense 
Agency (MDA), National Aeronautics and Space Administration 
(NASA), National Oceanic and Atmospheric Administration (NOAA), 
and the Intelligence Community. I understand the MDA is 
proposing to launch and control up to 12 satellites to detect 
missile tracks in space. How is this being coordinated and why 
is MDA controlling a fleet of satellites? Past DOD efforts with 
NOAA resulted in a failed weather satellite program. What did 
we learn here that will apply to any future interagency space 
efforts? It seems to me that the failure of past coordination 
has resulted either in failed programs or large cost increases 
to DOD. So I would like your help for us to understand what is 
being done to avoid future problems in this area.
    With that, it is my pleasure to turn the microphone over to 
my good friend and ranking member, Senator Sessions, for his 
opening statement. Let me say that we have had great 
cooperation and friendship in dealing with these issues in the 
past, and I know that we will continue to do that.

               STATEMENT OF SENATOR JEFF SESSIONS

    Senator Sessions. Absolutely. Thank you, Mr. Chairman, for 
that good statement. You raise a lot of issues. I will be 
brief.
    I thank all of you for being here and for the work that you 
do. Secretary Creedon, it is especially good to have you back 
to this committee room where you have harassed other witnesses. 
[Laughter.]
    So maybe you deserve to get some harassment today or, at 
least, help us harass other people.
    I was pleased that the Defense Strategic Guidance released 
in January recognized space as an area where DOD should 
prioritize and protect new capabilities and investments. It is 
a critical mission area. Our entire military depends on 
communication and observation from satellites that we just must 
have and be able to maintain even under hostile conditions.
    Defense is not immune, however, to budget cuts in fiscal 
year 2013. The budget request makes a number of difficult 
choices, some of which I agree with and some of which cause me 
concern. The fiscal year 2013 budget proposes significant 
reductions to the Air Force budget which is the majority of 
space funding, General Shelton, we calculate as being down 22 
percent. You and I have talked about that. You feel like that 
number may appear larger than it is based on some things that 
will not be needed by this year. But still, it is a pretty big 
number, Mr. Chairman. Given the magnitude of the reductions, I 
look forward to hearing from our witnesses about how we are 
doing for the future.
    The defense space enterprise is benefitting today from 
investments in the past over a long period of years, as it 
shifts from a challenging period of development to what I hope 
is a more stable period of production. Avoiding the challenges 
of the past decade will again require continued smart 
investments for the future.
    Over the course of the past few years, DOD has taken a 
number of important steps to address the rapidly growing costs 
of space, both out of necessity driven by budget pressures and 
NASA-related impacts on an already fragile industrial base, 
their reductions. The cost of developing, procuring, launching, 
and operating military space systems remains volatile. 
Affordability remains the central concern and despite some 
continuing instability, the fiscal year 2013 budget 
appropriately recognizes that significant strides must still be 
made to address the cost trends.
    Mr. Chairman, you mentioned ORS. I share your concerns 
there and maybe we can talk about that more.
    I am also pleased to see that GAO is participating in the 
hearing today. Good to see you. In recent months, GAO has 
published a number of assessments on programs spanning the 
defense space enterprise. GAO serves as an invaluable resource 
to the committee, Congress, and the American taxpayer taking 
into account some of GAO's recent recommendations on program 
improvement. I look forward to hearing from our DOD witnesses 
on what progress they have made in addressing these concerns.
    Finally, during our last hearing, I raised concerns about 
the administration's support for joining a European Union (EU) 
code of conduct for space, as you mentioned, Mr. Chairman. But 
I am pleased and I believe I understand that since that 
hearing, the administration appears to have concluded that 
signing this code as originally drafted would not be in the 
national interest unless significant modifications were made. 
So I look forward to understanding the administration's plan 
moving forward and specifically how DOD intends to protect our 
national security interest in space.
    There are other issues that I have concerns about, 
including some matters not appropriate for an open venue. I 
look forward to working with you to address those concerns. I 
know that you will be cooperative with our staff as Secretary 
Creedon used to benefit from when she was staff over here. So I 
know you will work with us on those issues.
    Thank you for joining us today. I look forward to the 
testimony.
    Senator Nelson. Thank you, Senator Sessions.
    We will start with the testimony today, and we will start 
first with Secretary Creedon.

 STATEMENT OF HON. MADELYN R. CREEDON, ASSISTANT SECRETARY OF 
              DEFENSE FOR GLOBAL STRATEGIC AFFAIRS

    Ms. Creedon. Chairman Nelson, Senator Sessions, it is a 
pleasure to be back here today, albeit a little bit strange to 
be at this side of the table and not in markup. But it surely 
is a pleasure, and thank you for the opportunity.
    Just a year has passed since the release of the first-ever 
National Security Space Strategy (NSSS), and I am pleased to be 
here to discuss its implementation and the defense space 
programs.
    This past January, as you mentioned, DOD published new 
Defense Strategic Guidance. This guidance was informed by the 
space strategy and reinforces the strategy's main tenets. Both 
documents stress the importance of operating effectively in 
space, promoting responsible behavior, operating when possible 
with allied and coalition forces, and increasing the resilience 
of our space-based capabilities.
    The goals serve a critical objective of DOD: protecting the 
advantages we derive from a domain that is increasingly 
congested, contested, and competitive. I would like to explain 
briefly and expand briefly on three important aspects of our 
space strategy.
    First, the NSSS and the new Defense Strategic Guidance both 
stress the need for resilience in our space capabilities in 
response to emerging anti-access, area-denial challenges. 
Resilience strengthens deterrence of attacks on our space 
assets and enables us to continue vital missions in a degraded 
space environment. Resilience is not the property of a single 
system. Rather, it is the ability of a whole architecture to 
provide functional capabilities that are necessary for mission 
success despite environmental adversity or hostile action. 
Resilience can be achieved in a variety of ways, including 
hosted payloads, commercial augmentation, international 
cooperation, and backup capabilities in other domains.
    A second key aspect of our strategy is promoting 
responsible behavior in space. In this area, DOD is playing a 
leadership role by providing countries and companies across the 
globe with warnings of potential collisions in space. In 
addition, DOD supports DOS's efforts to work with the EU and 
others to develop an international code of conduct for space 
activities. A widely subscribed code can encourage responsible 
space behavior and single out those who act otherwise while 
reducing the risks of misunderstanding and misconduct.
    The EU's draft is a promising basis for an international 
code of conduct, but it is just that. It is just a starting 
point. It focuses on reducing the risk of creating debris and 
increasing the transparency of space operations. It is not 
legally binding, and it does recognize the inherent right to 
self-defense. Further, this draft addresses behavior rather 
than unverifiable capabilities. Ultimately, it serves our 
interests much better than legally binding agreements, and it 
will not ban space weapons or any of the other capabilities 
that we have proposed.
    DOD is committed to ensuring that a code advances our 
national security as we continue to support the development and 
adoption of such measures moving forward.
    Third, the strategy emphasizes the need for a strong space 
industrial base. We can help energize the industrial base by 
allowing U.S. industry to compete internationally in sales of 
satellites and technologies that are already widely available. 
Last year, DOD and DOS provided an interim assessment of space 
export controls which concluded that commercial communication 
satellites and related components with a few exceptions can be 
moved from the U.S. munitions list to the Commerce Control List 
without posing an unacceptable security risk. Such a transition 
has dual benefits. It provides much needed support to the U.S. 
space industry while also focusing controls and enforcement on 
those technologies that are most sensitive and that are 
critical to national security.
    The forthcoming report, which we hope to have to Congress 
in just a few weeks, will recommend the movement of additional 
items to the Commerce Control List. This approach, higher 
fences around fewer items, will require new legislation, and 
your support will be needed.
    Implementation of the NSSS is ongoing, and I am pleased 
that DOD's new Defense Strategic Guidance reinforces our 
approach. DOD needs your continued support to deploy necessary 
capabilities, increase their resilience, and protect the 
industrial base that underpins the critical domain and that is 
so important to our national security.
    Thank you very much. I look forward to your questions.
    [The prepared statement of Ms. Creedon follows:]
             Prepared Statement by Hon. Madelyn R. Creedon
    Chairman Nelson, Ranking Member Sessions, and members of the 
subcommittee, I am pleased to join General Shelton, Dr. Zangardi, Mr. 
Winokur, Lieutenant General Formica, and Ms. Chaplain to testify on the 
Department of Defense (DOD) space program and policies. When Ambassador 
Greg Schulte testified here a year ago, the Department, together with 
the Office of the Director of National Intelligence, had just released 
the National Security Space Strategy (NSSS). Today, I am pleased to 
discuss our progress in implementing that strategy.
    U.S. space capabilities allow our military to see with clarity, 
communicate with certainty, navigate with accuracy, and operate with 
assurance. Maintaining the benefits afforded to the United States by 
space is central to our national security, but the evolving strategic 
environment increasingly challenges U.S. space advantages. Space is 
increasingly congested, with over 22,000 trackable manmade objects in 
orbit, contested, by an ever-increasing number of manmade threats, and 
competitive, as the U.S. competitive advantage and technological lead 
in space erodes.
    However, the challenges of a congested, contested, and competitive 
environment also present the United States with opportunities for 
leadership and partnership. The joint DOD and Intelligence Community 
NSSS released last year charts a path for the next decade to respond to 
the current and projected space strategic environment.
    The NSSS identifies three U.S. national security space objectives: 
strengthen safety, stability, and security in space; maintain and 
enhance the strategic national security advantages afforded to the 
United States by space; and energize the space industrial base that 
supports U.S. national security. Achieving these objectives will ensure 
our military continued access to space-based assets national security 
purposes.
    The United States will retain leadership in space by strengthening 
our national security, civil, and commercial space capabilities and 
improving our collaboration with others worldwide. Leadership cannot be 
predicated on declaratory policy alone. It must build upon a 
willingness to maintain strategic advantages while working with the 
international community to develop collective norms of responsible 
behavior, collaborate on capabilities with international and industry 
partners, and improve our coordination and information sharing.
    The President and Secretary of Defense recently released the 
Defense Strategic Guidance. This Guidance articulates priorities for a 
21st century defense that protects the country and sustains U.S. global 
leadership. It reflects the need for DOD and the military to adapt in 
order to proactively address the changing nature of the security 
environment and to reflect new fiscal realities. This Defense Strategic 
Guidance identifies the need to operate effectively in space as one of 
the missions most important to protecting national interests. Further, 
it cites resilience of space capabilities as an important component in 
projecting power in response to Anti-Access/Area Denial challenges.
    The new Defense Strategic Guidance builds on and reinforces key 
elements of the NSSS. The NSSS outlines five interrelated strategic 
approaches to chart a future course for national security in space, and 
many of those key approaches are also reflected in this Guidance. Both 
documents emphasize strengthening norms of responsible behavior, and 
finding opportunities to leverage growing civil, foreign and commercial 
capabilities. Both detail the need to strengthen deterrence while 
ensuring preparedness to operate in a degraded environment should 
deterrence fail. Both highlight the importance of the industrial base, 
as well as the need for innovative approaches and continued investment 
in science and technology.
    The Defense Strategic Guidance gives us renewed impetus to 
implement the NSSS, and we are incorporating the key points of the 
strategy into the departmental directives, guidance, and instructions. 
These documents shape how the DOD conducts the space enterprise, and 
changes here are integral to ensuring that we respond to this more 
challenging space environment.
    Additionally, we are further defining concepts like resilience as 
they relate to space. An important facet of the NSSS's effort to 
prevent and deter aggression against our space infrastructure is to 
strengthen the resilience of our architectures to deny the benefits of 
an attack. The strategy notes that resilience will also enable our 
ability to operate in a degraded space environment. As we invest in 
next generation space capabilities and fill gaps in current 
capabilities, the strategy directs us to include resilience as a key 
criterion in evaluating alternative architectures. Resilience is not 
the property of a single system. Rather, it is the ability of a whole 
architecture to provide functional capabilities necessary for mission 
success despite environmental adversity or hostile action. Resilience 
can be achieved in a variety of ways in space and beyond. These include 
system protection, cross-domain solutions, leveraging foreign 
capabilities, maturing responsive space capabilities, and hosting 
payloads on a mix of platforms.
    With this in mind, we developed a definition for resilience and 
criteria for assessment. We can no longer think only in terms of cost 
and capability. We must also consider whether that capability will be 
available when the warfighter needs it and an adversary seeks to deny 
it. This definition was reviewed and improved by the Defense Space 
Council and is now being promulgated. Our definition is simple:
    ``Resilience is the ability of an architecture to support the 
functions necessary for mission success in spite of hostile action or 
adverse conditions. An architecture is ``more resilient'' if it can 
provide these functions with higher probability, shorter periods of 
reduced capability, and across a wider range of scenarios, conditions, 
and threats. Resilience may leverage cross-domain or alternative 
government, commercial, or international capabilities.''
    We are implementing the definition and associated methodology for 
evaluation through current and future architectures, as well as across 
the Department's requirements, acquisition, and budget processes. 
Resilience is a key criterion in ongoing architecture reviews for our 
SATCOM, defense weather, and other satellite-based capabilities.
    We are taking a leading role in international efforts to promote 
responsible, peaceful, and safe use of space. The NSSS emphasizes that 
the United States will promote the responsible, peaceful, and safe use 
of space as the foundational step to addressing the congested and 
contested space domain. A more cooperative, predictable environment 
enhances U.S. national security and discourages destabilizing crisis 
behavior. We are supporting development of data standards, best 
practices, transparency and confidence-building measures, and norms of 
behavior for responsible space operations. For instance, we are 
participating, with other U.S. departments and agencies, in efforts 
taking place in the United Nations Committee on the Peaceful Uses of 
Outer Space to further the long-term sustainability of space.
    DOD supports U.S. efforts to work with the European Union and other 
spacefaring countries to develop an international code of conduct for 
space activities. A widely-subscribed Code can encourage responsible 
space behavior and single out those who act otherwise, while reducing 
risk of misunderstanding and misconduct. We view the European Union's 
draft code of conduct for space activities as a promising basis for an 
international code. The EU's draft focuses on reducing the risk of 
creating debris and increasing transparency of space operations. It 
already reflects U.S. best practices and is consistent with current 
practices such as notification of space launches and sharing of space 
data to avoid collisions. Significantly, the EU's draft is not legally 
binding and recognizes the inherent right of self-defense. It focuses 
on activities, rather than unverifiable capabilities, and better serves 
our interests than the legally-binding ban on space weapons proposed by 
others. In your recent letter to President Obama, you expressed 
concerns about the consequences of developing a code of conduct for 
space activities. As we go through the process of developing an 
international code, we are committed to ensuring that any code of 
conduct for space activities advances national security. The United 
States has been closely consulted by the EU on its draft, and we will 
continue to shape an international Code through active participation in 
international negotiations. Additionally, DOD has assessed the 
operational impact of the current draft and developed steps to ensure 
that a final Code fully supports our national interests and strategy. 
We are committed to keeping you informed on the process of developing 
an international Code.
    Working with international partners on encouraging responsible 
behavior in space is only a part of how our engagement with other 
spacefarers is evolving. The NSSS is driving changes in how we leverage 
the capabilities of domestic, international, and industry partners. The 
strategy directs us to pursue opportunities to partner with responsible 
nations, international organizations, and commercial firms to augment 
the U.S. national security space posture. Through these partnerships, 
we can ensure access to information and services from a more diverse 
set of systems--and advantage in a contested space environment. 
Decisions on partnering will be consistent with U.S. policy and 
international commitments and will consider cost, protection of sources 
and methods, and effects on the U.S. industrial base.
    We are expanding our international partnerships and coalition 
operations. Space is a domain in which we once operated alone. 
Increasingly, however, we need to think of operating in space as we do 
in other domains: in coalition.
    Allies like France, Japan, Germany, and Italy have increasing 
space-based capabilities in a range of mission areas. By leveraging 
their systems, we can augment our capabilities, add diversity and 
resilience, and complicate the decisionmaking of potential adversaries. 
Cooperation can also better enable coalition operations on land, at 
sea, and in the air, which for our allies and us are increasingly 
dependent on space-based capabilities.
    The Air Force's Wideband Global Satellite (WGS) system provides a 
good example. Earlier this year, the Air Force announced that Canada, 
Denmark, Luxembourg, the Netherlands, and New Zealand have joined with 
the United States and Australia in a long-term multilateral 
partnership. This effort will increase WGS capacity to U.S. warfighters 
by jointly acquiring and launching a ninth WGS satellite vehicle, while 
also providing system capacity to the partners. In addition to 
increasing the size and capacity of the constellation, 
internationalizing WGS also complicates the calculations of any country 
contemplating interference with the system.
    Led by General Kehler at U.S. Strategic Command (STRATCOM), the 
Department is working to transition today's Joint Space Operations 
Center into a Combined Space Operations Center (CSpOC). A CSpOC will 
leverage allied space capabilities to augment our own and increase 
resilience. It will support our ability to operate in coalition 
operations as we do in other domains and bolster collective defense and 
deterrence of attack against collective space assets. As the Department 
works through this transition, we are building on recent space 
exercises and cooperative activities, including tracking and analysis 
of the recent Phobos-Grunt spacecraft re-entry,
    Combined space operations require increased sharing of space 
situational awareness (SSA) and operational information. Earlier this 
year, the Secretary of Defense transferred to the Commander of STRATCOM 
his authority to enter into SSA data sharing agreements with foreign 
governments. This compliments STRATCOM's existing authority to 
negotiate SSA sharing agreements with commercial satellite operators. 
With the extension of this authority to foreign governments, the United 
States will be able to better assist partners with current space 
operations and lay the groundwork for future cooperative projects. The 
increasingly challenging space environment means that an unprecedented 
level of information sharing is needed among space actors, to promote 
safe and responsible operations in space and reduce the likelihood of 
mishaps, misperceptions, and mistrust.
    Commercial satellite owner/operators play an important role in SAA. 
STRATCOM currently has more than 30 data sharing agreements with these 
companies. This is just one of the innovative approaches to working 
with commercial space operators and protecting the space industrial 
base that is driven by the NSSS. We seek to foster a space industrial 
base that is robust, competitive, flexible, healthy, and delivers 
reliable space capabilities on time and on budget. We are exploring 
innovative approaches, such as anchor tenancy and hosted payloads, and 
pursuing strategic partnerships with commercial firms to stabilize 
costs and improve resilience.
    International advances in space technology have put increased 
importance on reforming U.S. export controls to ensure the 
competitiveness of the U.S. space industrial base while addressing 
technology security. Reforming export controls will facilitate U.S. 
firms' ability to compete in the international marketplace for 
capabilities that are, or will soon become, widely available globally, 
while strengthening our ability to protect the most significant U.S. 
technology advantages. The NSSS reaffirms the necessity of these 
reforms and echoes the National Space Policy's call for giving 
favorable consideration for export of those items and technologies that 
are generally available on the global market, consistent with U.S. 
national security interests. Reforming export controls on space items 
will increase U.S. manufacturers' ability to provide U.S. content in 
foreign satellites, increase opportunities for partnering with foreign 
manufacturers, and help energize the U.S. space industrial base.
    The NSSS responds to an increasingly challenging space environment. 
The changes detailed in the strategy will allow us to maintain and 
enhance the strategic advantages we derive from space. Over the past 
year, we have begun to implement those changes, both in our internal 
policies, and in how we relate to other spacefaring entities. DOD's 
fiscal year 2013 budget request, building on the new Defense Strategic 
Guidance, helps further the implementation of these changes and 
maintains the U.S. military's leading edge in space. The future 
architectures that we are developing will increase resilience while 
leveraging growing international and commercial capabilities in space. 
The Department looks forward to working closely with Congress, our 
allies, and U.S. industry to continue implementing this new strategy 
for space.

    Senator Nelson. Thank you.
    General Shelton.

  STATEMENT OF GEN. WILLIAM L. SHELTON, USAF, COMMANDER, AIR 
                      FORCE SPACE COMMAND

    General Shelton. Mr. Chairman, Senator Sessions, it is an 
honor to appear before you today as the Commander of Air Force 
Space Command.
    It is also my privilege to appear with these other 
colleagues in the national security space enterprise.
    The recently released Defense Strategic Guidance puts a 
premium on space and cyberspace capabilities, and in accordance 
with that guidance, the men and women of Air Force Space 
Command maintain a singular focus, providing vital space and 
cyberspace assets to the warfighter and to our Nation. Our 
assured access to space and cyberspace is foundational to 
today's military operations and to our ability to project power 
whenever and wherever needed across the planet.
    Accordingly, the fiscal year 2013 President's budget 
invests in programs which enhance the effectiveness of our 
space capabilities, namely missile warning, positioning, 
navigation, and timing (PNT), satellite communications, space 
situational awareness, and space launch. Admittedly, there is 
an overall reduction in funding levels in the space budget, but 
that is primarily due to fact-of-life programmatic changes 
rather than deep cuts in our programs.
    First, several of our key satellite programs will ramp down 
development activity as they transition to procurement, and 
this is a good news story.
    Second, Congress funded two wideband global satellites in 
fiscal year 2012, so there was no need to fund a satellite in 
2013.
    Third, the defense weather satellite system was canceled in 
the fiscal year 2012 Defense Appropriations Act, so there is no 
longer funding required for that program in this year's 
President's budget.
    In addition to these fact-of-life changes, we made some 
difficult space program budget reductions as a result of the 
$487 billion reduction mandated by the Budget Control Act 
(BCA). This led to relatively minor cuts in some modernization 
programs and a full restructuring of our approach to ORS and 
space testing. We continue to pursue acquisition efficiencies 
through our efficient space procurement actions for the AEHF 
program and SBIRS.
    Finally, we are committed to working closely with our 
partners in the National Reconnaissance Office (NRO) and NASA 
to lower the cost and bring stability to our launch programs.
    I thank the subcommittee for your steadfast support of my 
command and DOD's space programs. I look forward to your 
questions. Thank you, Mr. Chairman.
    [The prepared statement of General Shelton follows:]
          Prepared Statement by Gen. William L. Shelton, USAF
                              introduction
    Mister Chairman, Senator Sessions, and distinguished members of the 
subcommittee, it is my honor to appear before you today as the 
Commander of Air Force Space Command (AFSPC).
    I am privileged to lead over 42,000 Active Duty, Guard, and Reserve 
airmen; government civilians; and contractors delivering space and 
cyberspace capabilities around the world for our Nation. The men and 
women of AFSPC accomplish our mission at 134 worldwide locations, yet 
we operate in the space and cyberspace domains where borders are 
nonexistent. AFSPC space and cyberspace capabilities are integral to 
joint warfighting, as well as the daily lives of all Americans, and our 
professionals are passionate in their commitment to excellence and 
mission success.
    This year, AFSPC celebrates its 30th anniversary, and for over two 
of those three decades, the command has been involved in continuous 
combat operations. While AFSPC has evolved over the years, with the 
inclusion and then departure of intercontinental ballistic missile 
responsibilities, and the relatively new addition of cyberspace 
operations, a single focus has endured: providing the best capability 
possible to ensure success on the battlefield.
    On January 5, 2012, the Secretary of Defense released a new 
strategy document titled Sustaining U.S. Global Leadership: Priorities 
for 21st Century Defense. This new strategy identifies the need to 
operate effectively in space and cyberspace by stating, ``Modern Armed 
Forces cannot conduct high-tempo, effective operations without reliable 
information and communication networks and assured access to cyberspace 
and space.'' Space and cyberspace forces are key components to the 
Nation's ability to project power. In concert with the strategy, our 
mission is to provide resilient and cost-effective space and cyberspace 
capabilities for the joint force and the Nation. AFSPC's activities are 
guided by three priorities: support the current fight; control space 
system costs and deliver capabilities on time and on budget; and for 
the purpose of organizing, training and equipping, we are 
operationalizing and normalizing Air Force efforts involving 
cyberspace. From these general priorities we have adopted three goals 
to ensure mission success: provide assured full spectrum space and 
cyberspace capabilities; field resilient, integrated systems that 
preserve the operational advantage; and provide highly skilled and 
innovative space and cyberspace professionals. The remainder of the 
statement is organized around these goals.
    provide assured full spectrum space and cyberspace capabilities
    Our ability to detect launches, track missiles, navigate with 
precision, detect nuclear events, support military communications 
requirements, improve space situational awareness, predict weather, and 
perform operations in cyberspace are all foundational to the way the 
joint force fights today. We depend on the vast capability of our 14th 
Air Force, 24th Air Force (24 AF), the Space and Missile Systems Center 
(SMC), Air Force Network Integration Center (AFNIC), Space Innovation 
and Development Center (SIDC), and the Air Force Spectrum Management 
Office (AFSMO) to acquire and operate these space and cyberspace 
systems. The precision and responsiveness needed to deter aggression 
and win America's wars stem from our ability to integrate and 
synchronize capabilities across the full range of military operations 
and all warfighting domains. In space, the command is deploying the 
next generation of spacecraft and continuing to provide technologically 
advanced capabilities. Also, we are pursuing international agreements 
to expand missile warning, space-based communication capabilities and 
space situational awareness (SSA). In cyberspace, the command is 
expanding collaboration with our joint, interagency, and international 
partners on several initiatives to safeguard our access to the domain. 
We are operationalizing the Air Force's approach to cyberspace with 
emphasis on protecting the Air Force infrastructure, developing 
expertise to meet mission needs, and accelerating our acquisition 
processes to match the rate of change in cyberspace.
Missile Warning (Launch Detection and Missile Tracking)
    Our ability to provide strategic missile warning is critical to the 
Nation's survival. Ballistic missiles also pose a significant threat to 
deployed U.S. forces and our allies. AFSPC operates both space- and 
ground-based sensors, providing correlated data that supports the 
strategic and tactical missile warning missions. Our space 
professionals continue to improve upon our missile warning capabilities 
and processes to better alert and inform our commanders. In U.S. 
Central Command (CENTCOM), Captain Kara Sartori, Chief of the Combat 
Operations Division Space Cell at the Combined Air and Space Operations 
Center, built revolutionary new procedures which provide more accurate 
and timely missile warning, thereby better protecting personnel 
assigned across the CENTCOM theater of operations.
    Space Based Infrared Systems
    The Space Based Infrared System (SBIRS), along with the legacy 
Defense Support Program satellites, provide advanced early warning of 
hostile missile threats, allowing our warfighters to take swift and 
precise action. The Active Duty and Reserve airmen of the 460th Space 
Wing, Buckley Air Force Base (AFB), CO, as well as assigned British, 
Canadian and Australian personnel, provided U.S. Combatant Commanders 
(COCOMs), coalition partners and allies assured warning for nearly 200 
missile launches in 2011. They also reported 7,100 special infrared 
events--an 82 percent increase from 2010. Part of that increase was due 
to the work of Captain William Sanders and Staff Sergeant Justin 
Rutherford, 11th Space Warning Squadron, Schriever AFB, who developed 
new and innovative ways to use the data from these sensors to identify 
more events of interest to the warfighter.
    In May 2011, AFSPC launched the program's first SBIRS 
Geosynchronous Earth Orbit (GEO) satellite and early mission data are 
exceeding expectations. This system detects dimmer, shorter duration 
infrared events and provides more accurate missile launch and impact 
point predictions than the Defense Support Program satellites. To 
reduce costs on future acquisitions of these vital satellites, Colonel 
Michael Guetlein from SMC, Los Angeles AFB, CA, and his program 
management team streamlined schedules, reduced contractor overhead, and 
achieved production efficiencies. This effort, and many more like it, 
will ensure affordable capability well into the future.
    The Air Force fiscal year 2013 request for SBIRS Research, 
Development, Test and Evaluation (RDT&E) and Procurement is $950 
million, paced by ground development and continuing efforts on SBIRS 
GEO satellites 3 and 4 as well as the procurement of SBIRS GEO 
satellites 5 and 6. We are requesting the use of advance appropriations 
to fully fund satellites 5 and 6.
    Upgraded Early Warning Radar (UEWR)
    The UEWR radars are ground-based components of missile warning and 
missile defense against current and emerging ballistic missile threats. 
They also provide space object tracking data to help achieve space 
situational awareness. Throughout 2011, we continued work with the 
Missile Defense Agency to finalize UEWR deployments to Beale AFB, CA, 
Royal Air Force Fylingdales, United Kingdom and Thule Air Base, 
Greenland. In 2012, we will begin the process to upgrade Clear Air 
Force Station, AK and Cape Cod Air Force Station, MA to the UEWR 
configuration. At the operational units, long-time system experts, like 
Mr. Clennis Burress at Beale AFB, CA, analyzed data from the upgraded 
radar to assess performance on recent space and missile events. Using 
his experience and creativity, he has devised ways to extract even more 
capability from these radars.
U.S. Nuclear Detonation (NUDET) Detection System (NDS)
    The NDS has maintained the global situational awareness needed by 
our national decisionmakers and monitored nuclear treaty compliance 
since the early 1960s. NDS payloads are hosted on the Global 
Positioning System (GPS) satellites and our Defense Support Program 
satellites. This capability is also included in the next generation of 
GPS satellites. The Department of Energy and AFSPC are conducting 
studies to determine the most effective solution to a long-term space-
based NDS architecture.
Positioning, Navigation, and Timing (PNT)
    It is difficult to overstate the impact of GPS on the world. On-
line banking, vehicle navigation systems, precision farming, cellular 
phone location for emergency purposes, precise military operations--
these are all enabled by GPS. Last October, I was honored to accept, on 
behalf of the GPS program, an award from the International 
Astronautical Federation on the occasion of their 60th Anniversary. The 
award was given to the program which most benefitted mankind throughout 
the entire 60 year history of the Federation. I was joined by Colonel 
(Retired) Bradford Parkinson, who is universally regarded as the father 
of GPS, and the current program manager, Colonel Bernard Gruber.
    The GPS program made great strides in 2011. We improved the 
security and functionality of GPS-enabled military systems by providing 
for over-the-air distribution of rekeying for our military receivers. 
Under the leadership of Captains Vernon Reddick and Jayson Andersen 
from the 2nd Space Operations Squadron, Schriever AFB, we completed the 
final phase of an operation called ``Expandable 24''--the largest 
satellite repositioning effort in GPS history. The constellation is now 
optimized for terrestrial coverage in challenging environments such as 
cities with tall buildings and the mountains and valleys of 
Afghanistan.
    Through the summer and fall of 2011, Captain Justin Deifel from 
SMC's GPS System Program Office, Los Angeles AFB, expertly led three 
rigorous tests on behalf of the National Space-Based PNT Systems 
Engineering Forum to quantify the potential for interference to 
military and civilian GPS users from LightSquared's proposed 
terrestrial network. His technical prowess and objectivity ensured 
these nationally significant tests were professionally accomplished in 
a thorough, fact-based manner.
    We currently have 34 GPS satellites on-orbit with a combined 380 
years of service. The oldest GPS operational satellite on orbit was 
launched 21 years ago. The second launch of our newest version, GPS-
IIF, occurred in July 2011. Captain Steve Dirks from our GPS Reserve 
Associate Unit, 19th Space Operations Squadron, Schriever AFB, led the 
check-out of the satellite, integrating it into the operational 
constellation in August 2011. GPS-IIF satellites are a major component 
of the GPS modernization process: introducing greater accuracy through 
advanced atomic clock technology, providing military signals that are 
more resistant to jamming, adding a new ``safety of life'' civilian 
signal, and lowering operating costs through a longer design life. 
Development of the next generation satellite, GPS-III, is on-cost and 
on-schedule. These satellites add a fourth civil signal to the 
constellation and complete the deployment of two civil signals and 
military signal capabilities that began with earlier GPS satellites. 
GPS-III will allow us to affordably sustain and modernize the 
constellation. AFSPC will continue to be proud stewards of this 
incredible capability, and in line with the National Space Policy, we 
will strive to ensure it remains the gold standard for global timing 
and navigation.
    With the ubiquitous use of space systems, to include GPS, in the 
CENTCOM Area of Operations, AFSPC forward deploys experts to ensure 
warfighter needs are satisfied. Captain Bryony Veater, assigned to the 
504th Expeditionary Air Support Operations Group in Afghanistan, 
provided critical forward-based space expertise and training to help 
deployed forces fully exploit GPS capabilities. As an example of the 
versatile use of GPS, CENTCOM performs the precision airdrop of 
supplies with the Joint Precision Air Drop System, using GPS guided, 
steerable parachutes. In November 2011, CENTCOM used this system to 
airdrop 18,000 pounds of winter fuel to Air National Guard soldiers 
from my home State of Oklahoma, at Combat Outpost Herrera in eastern 
Afghanistan.
    The Air Force fiscal year 2013 request for GPS III in RDT&E and 
Procurement is $1.264B, which continues GPS III space and ground 
segment RDT&E and procures additional GPS III Space Vehicles.
Military Satellite Communications
    The demand for Military Satellite Communications (MILSATCOM) 
continues to grow as warfighters increasingly depend on information 
relayed from space, especially for today's distributed operations in 
this era of information-enabled warfare. Our protected and survivable 
MILSATCOM supports presidential communications, forms the backbone of 
our Nuclear Command and Control System, and provides services for 
operations in contested environments. MILSATCOM also enables day-to-day 
communications in more benign environments. There are 18 MILSATCOM 
satellites on-orbit with a combined 183 years of service.
    Advanced Extremely High Frequency (AEHF)
    The first satellite in the next generation of protected and 
survivable MILSATCOM, AEHF-1, reached geosynchronous orbit in October 
2011, approximately 14 months after a spacecraft propulsion anomaly had 
stranded the satellite far short of its operational orbit. The AEHF-1 
operations team designed an innovative orbit-raising strategy to 
preserve the planned 14-year design life of the satellite. The team, 
led by Mr. David Madden, SMC, is a finalist for an Aviation Week 
Laureate Award to recognize their extraordinary achievement. Each AEHF 
satellite will provide a ten-fold throughput increase over Milstar in 
secure, jam-resistant communications for national leaders, COCOMs and 
our international partners--Canada, the Netherlands and the United 
Kingdom.
    The Air Force fiscal year 2013 request for AEHF RDT&E and 
Procurement is $786 million, which provides for remaining development 
efforts and continued procurement of AEHF Space Vehicles 5 and 6. We 
are also requesting the use of advance appropriations to fully fund 
satellites 5 and 6.
    Wideband Global SATCOM (WGS)
    The WGS system provides flexible, high-capacity communications to 
the Department of Defense, the White House Communications Agency and 
the State Department. Each satellite improves on the communications 
capacity, connectivity and flexibility of legacy systems, allowing for 
seamless crossbanding between users with X and Ka frequency band 
terminals. WGS supported the Reagan Carrier Strike Group as it provided 
humanitarian assistance and disaster relief support to Japan in the 
aftermath of the 2011 Tohoku earthquake and tsunami, allowing users 
outside of Japan with Ka-terminals to communicate directly with users 
in Japan with X-band terminals.
    WGS-4, the first WGS Block II satellite, launched this past 
January. These satellites were developed in direct response to 
warfighter feedback and will support the transmission of airborne 
intelligence, surveillance, and reconnaissance imagery at data rates 
approximately three times greater than those currently available on 
Block I satellites. In addition, we are exploring future enhancements 
to WGS that will deliver even more flexibility and capacity as we 
incorporate commercial technology advances and cost-saving practices 
into the system.
    We are especially proud of the robust international partnerships we 
have formed as part of this program. Australia provided funding for 
WGS-6, and in January 2012, the Department of Defense and counterpart 
agencies from Canada, Denmark, Luxembourg, Netherlands and New Zealand 
signed a Memorandum of Agreement to procure WGS-9 through a cooperative 
effort.
Space Situational Awareness
    SSA is fundamental to everything we do in space. As our dependence 
on space capabilities increases, and as the number of space faring 
nations and objects in space increase, so does the need to improve our 
SSA. We have a vast amount of SSA data, but we cannot yet fuse those 
data into a single, correlated, comprehensive situational awareness 
picture. The Joint Space Operations Center (JSpOC) Mission System (JMS) 
program will correct this shortfall.
    Joint Space Operations Center
    The JSpOC, at Vandenberg AFB, is the primary national security 
space command and control center for our Nation. Thanks to the 
dedicated efforts of Airmen such as Major Brian Capps and Master 
Sergeant Thomas Clark, during one noteworthy surge period, the JSpOC 
provided simultaneous support to day-to-day global space missions, 
CENTCOM activities, U.S. Africa Command military operations in Libya 
and humanitarian assistance and disaster relief efforts in Japan. In 
2011, JSpOC personnel provided SSA in support of COCOMs by processing 
155 million sensor observations and tracking approximately 22,000 
manmade objects. They provided reentry warning and analysis for 72 
high-interest objects, including the National Aeronautics and Space 
Administration's decommissioned Upper Atmosphere Research Satellite, 
and most recently, the Russian Phobos-Grunt spacecraft.
    While accomplishing their complex missions, JSpOC personnel manage 
and update the catalog of all manmade objects that orbit the earth 
using a system called the Space Defense Operations Center which has 
been operational since the mid-1980s, and which hasn't had a major 
software upgrade since the early 1990s. The replacement for this legacy 
system is the JMS. It will automate many of the tasks done manually 
today and will incorporate traditional and non-traditional sensor 
inputs to produce relevant, actionable information for the Commander, 
Joint Functional Component Command for Space, currently Lieutenant 
General Susan Helms. In 2011, we completed the restructure of the JMS 
acquisition program to significantly lower costs, better align initial 
capability deliveries with warfighter needs and more efficiently 
execute the program. This streamlined approach leverages existing 
industry and government investments, while providing on-ramps for 
industry to contribute products. Initial Operational Capability of the 
first increment is scheduled for the end of 2012.
    The Air Force fiscal year 2013 request for JMS in RDT&E is $54.6 
million, which continues incremental upgrades to SSA and Space Command 
and Control capabilities.
Weather
    The Defense Meteorological Satellite Program (DMSP) celebrates its 
50th anniversary in 2012. We will extend the tradition of a half 
century of unique and superb weather forecasting capabilities when we 
launch the final two DMSP satellites later this decade. Following the 
congressional direction in the fiscal year 2012 budget, the follow-on 
program to DMSP was cancelled. We will conduct a study this year to 
define a lower cost, yet capable, weather satellite follow-on program.
Cyberspace
    National and Department of Defense leaders recognize the 
criticality of operations and freedom of action in cyberspace. As the 
pace of technological, environmental and geopolitical change quickens, 
the ability of Joint Force Commanders to defend America's interests 
will increasingly rely on the access, persistence and awareness 
provided by cyberspace systems and capabilities. To that end, 24 AF is 
taking a disciplined approach to cyberspace operations to significantly 
increase our security posture, defend freedom of action, leverage our 
effectiveness across Joint and coalition operations, and be more 
efficient with resources consumed for and by our Air Force cyberspace 
enterprise.
    We are presenting cyberspace capabilities, organized by fixed and 
expeditionary forces, to support our Air Force and Joint Commanders' 
objectives and required effects. In 2011, cyberspace operators from 24 
AF supported 5 COCOMs in more than 25 operations. Our deployed 
cyberspace experts facilitated interaction with the COCOMs, 
contributing to the success of these Joint operations. For Operation 
Odyssey Dawn, Captain Michael Piersimoni deployed from the 624 
Operations Center (OC) to assist with U.S. Africa Command's efforts to 
leverage cyberspace effects.
    In the area of cyberspace operations and innovation, we are 
pursuing practices to expeditiously leverage new technologies in a 
cost-effective manner--essential to staying ahead of emerging threats 
and achieving desired end states. With the help of programmers like 
Staff Sergeant Ryan Knight and testers like Captain Benjamin Truax, the 
688th Information Operations Wing, Lackland AFB, is exercising rapid 
cyberspace capability innovation processes. In just 7 days, they met 
COCOM needs by developing and testing a new cyberspace capability; 
creating tactics, techniques and procedures; and training operators. 
Using similar processes, we were able to expeditiously deliver 28 new 
cyberspace enhancements to support warfighter urgent needs in 2011.
    We are also building a consolidated Air Force Network, known as the 
AFNet. Major General Suzanne Vautrinot, 24 AF Commander, leads the 
operation and defense of this network for the Air Force as the AFNet 
Operations Commander. We continue to make progress toward consolidation 
of the AFNet projected for completion by the end of fiscal year 2013. 
As of February 13, 2012, Major Gregory Roberts, 561st Network 
Operations Squadron, Detachment 3, Scott AFB, IL, and Mr. Nick 
Davenport, AFNIC, also at Scott AFB, led the migration of 34 bases onto 
the AFNet, retiring 30 legacy networks and collapsing 104 connections 
to the Global Information Grid to 16 defensible gateways. These 
significant steps reduce the costs to operate and enable us to better 
defend our complex network, supporting over 845,000 users. Operating 
the network under the principle of centralized control and 
decentralized execution cleared the way for Senior Airman Zane Williams 
and other members from the 561st Network Operations Squadron's 
Detachment 1 at Hickam AFB, HI, to restore AFNet connectivity and 
services less than 5 hours after the Tohoku earthquake and tsunami.
    Our Combat Communications units execute another facet of the 
cyberspace mission by extending our networks and providing 
communications to disadvantaged users. Due to the planning efforts of 
individuals such as Captain David Cox, 54th Combat Communications 
Squadron, Robins AFB, GA, combat communications personnel provided 
``last out'' communications for redeploying United States combat forces 
from Iraq. In one case, members of the 263rd Combat Communications 
Squadron, an Air National Guard unit, volunteered for a short notice 
deployment, establishing critical communications for the 332nd Air 
Expeditionary Wing as it relocated from Joint Base Balad in Iraq. In 
Afghanistan, Staff Sergeant Stephen Herron, from the 52nd Combat 
Communications Squadron, Robins AFB, received the Bronze Star for his 
actions as the sole communications member assigned to an Explosive 
Ordnance Disposal Joint Task Force where he provided tactical 
communications and force tracking capabilities for ten teams. Within 
the United States, our Combat Communications Guardsmen supported 
firefighters near Bastrop, TX, as well as recovery efforts following 
the tragic tornado in Alabama.
Director of Space Forces
    Our space professionals are assigned and deployed to COCOMs around 
the globe. In January, I met with Colonel Clinton Crosier, the Air 
Force Central Command Director of Space Forces, and his team. Captain 
Tracy Lloyd is revolutionizing how the DOD is providing operations 
planning products for GPS-enabled systems--making them more combat 
relevant. Major Natalie Mock and Captain Abraham Brunner are using the 
multi-spectral Operationally Responsive Space-1 (ORS-1) satellite to 
solve tough intelligence problems in theater. Colonel Crosier's staff 
is working hand-in-hand with Lieutenant Colonel Chad Le'Maire, from the 
Cyber Operations Liaison Element, to oversee systems that bring to bear 
the full synergy of integrated space and cyberspace capabilities in the 
CENTCOM Area of Responsibility.
    Colonel Alan Rebholz, the Pacific Air Forces Director of Space 
Forces, and the team of space professionals in the Pacific are 
integrating space at new levels as the emphasis increasingly turns to 
this area. Major Robert McConnell, a space professional in the Strategy 
Division of the 613th Air and Space Operations Center, and his 
teammates are planning the space operations portion of Exercise 
Terminal Fury 2012, which will be conducted simultaneously with U.S. 
Strategic Command's Global Lightning exercise. This combined exercise 
will have an unprecedented, robust space scenario involving 
participants across the globe.
   field resilient, integrated systems that preserve the operational 
                               advantage
    Our second goal is to field resilient, integrated systems that 
preserve the operational advantage. As the Air Force lead for the space 
and cyberspace domains, AFSPC is working hard to build efficient 
architectures and processes. We are defining better ways of doing 
business to decrease cost while delivering resilient, integrated and 
affordable space and cyberspace systems--without compromising mission 
assurance. As part of our efficient approach, the Command is leveraging 
the Total Force--Active Duty, Guard, and Reserve airmen; government 
civilians; and contractors--across all areas within the command.
Launch, Ranges, and Networks
    Every on-orbit space capability begins with a successful launch--
there is no room for error in the launch business. Our 45th Space Wing 
at Patrick AFB, FL, and our 30th Space Wing at Vandenberg AFB, operate 
the Eastern and Western Ranges, respectively. They supported a combined 
19 commercial and government launches in 2011, including the final 3 
Space Shuttle missions. They also conducted over 2,500 weapon system 
tests, aeronautical tests and launch support operations. Our emphasis 
on mission assurance underscores an unprecedented record in the history 
of space flight--83 consecutive successful National Security Space 
launches since 1999. Mission assurance is a rigorous, structured, and 
disciplined application of systems engineering, risk management, 
quality assurance, and program management principles throughout a space 
system's life cycle.
    Launch is often the greatest risk to any space system. There are 
many examples of how rigorous mission assurance detected and corrected 
issues that would have led to launch failures if uncorrected. We have a 
dedicated team of mission assurance technicians at both launch bases 
performing meticulous quality control for launch operations. On the 
East Coast, Master Sergeant Michael Claus, 5th Space Launch Squadron, 
identified a safety violation during hardware movement operations, 
preventing costly damage to the Atlas V assigned to the Navy's Mobile 
User Objective System satellite. On the West Coast, Staff Sergeant Paul 
Lillie from the 4th Space Launch Squadron, Vandenberg AFB, observed and 
reported a leak in a valve during processing of an Atlas V in 
preparation for an April 2011 National Reconnaissance Office mission. 
Failure of this component during launch would have prevented proper 
orbital insertion of the payload, leading to mission failure.
    Mission assurance also includes careful oversight of spacecraft 
processing at the launch base in preparation for launch. Captain Amanda 
Zuber and other members of the 45th Launch Support Squadron, Patrick 
AFB, performed spacecraft mission assurance activities for the first 
SBIRS GEO spacecraft, which is now exceeding performance expectations 
on-orbit. Air Force launch and range services are on track to support 
11 Evolved Expendable Launch Vehicle missions in 2012: 8 National 
Security Space launches, 2 National Aeronautics and Space 
Administration launches, and 1 commercial Orbital Test Vehicle launch.
    Due to the critical dependence of the space mission on our launch 
capabilities, the Air Force established a Program Executive Office for 
Space Launch to provide a focused effort as we define the future of 
space launch. In November 2011, the Air Force Service Acquisition 
Executive approved a new acquisition strategy addressing industrial 
base viability and cost growth while making provisions to leverage 
emerging competition. The Air Force, in cooperation with the National 
Reconnaissance Office, is committed to an annual production rate of 
launch vehicles, creating more predictability and stability in the 
program. In addition, the Air Force published a New Entrant 
Certification Guide, providing a structured certification process by 
which prospective commercial launch providers become eligible to 
compete for national security launch service contract awards. Both the 
annual production rate commitment and the leveraging of new entrants 
are key elements we must balance as we conduct the fiscal year 2013 
through fiscal year 2017 acquisition program, led by Colonel William 
Hodgkiss, our program manager at SMC. This acquisition program will 
define the landscape for National Security Space assured access into 
the next decade.
    The Air Force fiscal year 2013 request for the Evolved Expendable 
Launch Vehicle Procurement is $1.680 billion, which provides launch 
infrastructure and boosters for national security space launches.
    For many of our Nation's most critical satellites, the Air Force 
Satellite Control Network provides launch support, the capability to 
receive satellite data, and command and control of these spacecraft 
once on-orbit. In 2011, our space professionals used the network to 
conduct over 159,000 satellite contacts, support 15 launches and more 
than 20 space vehicle emergencies, averaging 450 satellite contacts per 
day. The network added a new operational antenna in Diego Garcia, 
doubling our capacity in the Indian Ocean to support satellite 
operations and to meet near-real-time warfighter, weather, missile 
warning, PNT, surveillance and communication needs. We are modernizing 
the Air Force Satellite Control Network by replacing its decades-old 
communication, scheduling, and antenna systems.
Commercially Hosted Infrared Payload
    One avenue AFSPC is exploring for improving system resiliency is 
the concept of hosting government payloads on commercial satellites. 
The Commercially Hosted Infrared Payload is a government infrared 
payload hosted on the SES-2 commercial spacecraft. From program 
initiation to launch in 39 months, this payload successfully reached 
orbit with its host, after launch on a European Ariane V rocket from 
Kourou, French Guiana in September 2011. This mission is providing 
lessons learned on the operational- and cost-effectiveness of hosting 
government payloads on commercial satellites, while also demonstrating 
a potential approach to mission resiliency.
Defensive Space Control
    We rely on resilient architectures complemented with passive and 
active defense measures to deter, and if necessary, defeat potential 
adversary attacks against our forces. In the defensive space control 
mission, the Rapid Attack, Identification, Detection, and Reporting 
System Deployable Ground Segment-0 (RDGS-0), continues its trend of 
sustained excellence in the CENTCOM Area of Responsibility. In the past 
year, the members of the 16th Space Control Squadron, Peterson AFB, CO, 
and its collocated Reserve Associate unit, the 380th Space Control 
Squadron, deployed the Bounty Hunter system to increase the capability 
of RDGS-0. The current deployment team, led by Major Matthew Wingert 
from the 380th Space Control Squadron, and Master Sergeant Timothy 
Tennerman from 460th Space Wing, are helping protect the vital 
communications links across all of CENTCOM's operations.
Responsive Capabilities
    In 2011, the Air Force launched two space systems demonstrating 
responsive space principles. ORS-1 launched in June 2011 on a Minotaur 
I rocket from the National Aeronautics and Space Administration Wallops 
Flight Facility, Wallops Island, VA, only 32 months from program 
initiation. CENTCOM began using the imagery products from this 
satellite 1 month later. Personnel from the 1st Space Operations 
Squadron and their Reserve Associate Unit, the 7th Space Operations 
Squadron, at Schriever AFB, are using the Multi-Mission Satellite 
Operations Center to command and control the satellite. This command 
and control suite is AFSPC's first step toward a common ground system 
across multiple satellite programs, with the goal of reducing ground 
system costs for new programs. Captain David Gwilt from SMC is leading 
the maturation of this architecture.
    The second Orbital Test Vehicle, X-37B, mission launched in March 
2011 and has surpassed the first mission's 8-month duration, proving 
the flexibility of this unique system. Major Scott Babb, from the SIDC 
3rd Space Experimentation Squadron, is leading the operations team as 
they explore the capabilities of this system.
Electromagnetic Spectrum
    Electronic devices are pervasive in modern warfare, increasing the 
demand for electromagnetic spectrum access. AFSPC's AFSMO preserves 
access to the electromagnetic spectrum for Air Force and selected 
Department of Defense activities. Mr. Joseph Sulick and his team 
maintained over 30,000 frequency assignments essential to test, 
training, Joint and Service exercises and operations. AFSMO's strategic 
planning efforts, led by Mr. Frederick Moorefield, focus on assuring 
the continued and improved spectrum access required for critical 
military systems as both national and international demand increases 
for finite spectrum resources. Within the United States, they are 
supporting the President's direction to identify spectrum for broadband 
wireless services. Internationally, they are engaged with the U.S. 
delegation to the United Nations International Telecommunication 
Union's World Radiocommunication Conference to protect United States 
and Air Force spectrum interests.
Single Integrated Network Environment
    The Air Force requires an integrated enterprise network to assure 
core cyberspace capabilities. Colonel Rizwan Ali, Commander of AFNIC at 
Scott AFB is forging the AFSPC Single Integrated Network Environment 
into reality. Mr. Frederick Chambers and his team of professionals are 
collaborating with leaders from SMC, 24 AF and my staff to achieve the 
desired end state of seamless information flow across terrestrial, air 
and space domains. Networthiness, as a component of the Single 
Integrated Network Environment, will offer integration and 
interoperability for Air Force networks.
    To fuse partnerships with industry leaders, Lieutenant Colonel Jeri 
Harvey led the Air Force's inaugural Software Development Forum. During 
the forum, AFNIC announced upcoming changes to Air Force standards for 
integrating and supporting applications across the AFNet. These 
standards will increase our security posture while reducing the number 
of network resources required. The Software Development Forum, along 
with other efforts, will help us to provide cyberspace network-centric 
capabilities to the warfighter.
      provide highly skilled and innovative space and cyberspace 
                             professionals
    Our third goal is to provide highly skilled and innovative space 
and cyberspace professionals. AFSPC is educating, training and 
cultivating experts skilled in space and cyberspace capabilities and 
their integration across the full range of military operations in all 
domains. They are tactically and operationally proficient, and are 
ready to deploy at a moment's notice.
Space Education, Training, Wargames, and Exercises
    Each year, the SIDC's Advanced Space Operations School (ASOpS) 
provides advanced training to more than 1,930 DOD personnel, while the 
National Security Space Institute (NSSI) provides space professional 
certification courses to over 800 personnel from all Services and 
military representatives from select allied nations. At the end of 
2011, the Air Force had over 13,000 certified space professionals. The 
military construction project to house ASOpS and NSSI on Peterson AFB 
is near completion and a ribbon-cutting ceremony is scheduled for this 
spring.
    The Schriever Wargame series is a valuable tool for examining the 
opportunities and threats inherent to the space and cyberspace 
environments. The Wargame Director, Major David Manhire, from the SIDC, 
Schriever AFB, will execute the Schriever 2012 Wargame in two phases 
with a renewed focus on the operational level of planning. The 
International Wargame is based on a contingency operation, involving 
North Atlantic Treaty Organization nation participation on the game 
floor for the first time. In September 2012, Australia, Canada, and 
Great Britain will join the United States in executing the second phase 
of the Wargame.
    Last year marked the first time a tactical space unit participated 
in a Distributed Mission Operations exercise from their home station. 
The SIDC's Distributed Mission Operations Center for Space served as 
the environment for the 2nd Space Warning Squadron at Buckley AFB, to 
provide theater ballistic missile warning to the 612th Air and Space 
Operations Center at Davis-Monthan AFB, AZ. SIDC also premiered the GPS 
Environment Generator during a Blue Flag exercise. This system 
generates realistic degraded navigation effects and weapons accuracy, 
allowing operators and planners to see the direct influence of 
anticipated hostile and non-hostile GPS interference. Further 
integration of this model is in work to allow aircrews to plan and 
employ weapons in a virtual environment.
Cyberspace Education, Training, and Wargames
    The Air Force must have professionals capable of integrating 
cyberspace capabilities across the warfighting domains. Under the 
Cyberspace Professional Development Program, Total Force personnel 
receive continuing education to progress from a foundation of 
fundamentals, through demonstrated depth of knowledge of experience and 
application, to a strategic understanding of cyberspace. In December 
2011, the Air Force formalized this program to include a certification 
process. We now have over 5,200 Air Force Total Force personnel 
certified as cyberspace professionals.
    In partnership with Air Education and Training Command and Air 
Combat Command, AFSPC continues to build a highly skilled cyberspace 
work force by providing cyberspace training at all levels of the Air 
Force. The 333rd Training Squadron at Keesler AFB, MS graduated the 
first class of enlisted Cyberspace Defense Operators. With the 
dedicated efforts of Airmen such as Captain Laura Sepeda, the 39th 
Information Operations Squadron, Hurlburt Field, FL, graduated the 
first class of students from Intermediate Network Warfare Training in 
2011. They also developed the first Initial Qualification Training, 
allowing cyberspace operators to arrive at operational units fully 
qualified to perform the mission. Members of this squadron received the 
2011 United States National Cybersecurity Innovation Award from the 
SANS Institute for ``Developing World-Class Cyberspace Talent'' through 
their use of simulators and training ranges to allow students to 
conduct defensive cyberspace operations. The Air Force Institute of 
Technology's Cyberspace Technical Center of Excellence began conducting 
the Cyberspace 200 and 300 intermediate and advanced professional 
development courses in June 2010. Through the end of 2011, they have 
graduated 754 people from these courses. In June 2012, the U.S. Air 
Force Weapons School at Nellis AFB, NV will conduct the first 
Cyberspace Weapons Instructor Course. Once the students complete this 
difficult 6-month course, the initial cadre of weapons officers will be 
instrumental in developing unit level tactics and supporting 
operational level planning to meet the challenges of evolving 
cyberspace threats.
    Red Flag is the Air Force's advanced aerial combat training 
exercise. During Red Flag 2011-3 missions, Major Benjamin Montgomery, 
624 OC, made history as the first cyberspace operator to lead an 
exercise event as the designated Mission Commander--integrating full 
spectrum capabilities into Air and Space Operations Center mission 
planning and operations. Red Flag is the ideal venue for demonstrating 
and exercising full spectrum cyberspace capabilities and we intend to 
continue on this path.
    Our cyberspace operators reached a major milestone with the 
planning and execution of the first Cyber Flag in October 2011 at 
Nellis AFB, NV. This Joint exercise fused cyberspace across the full 
spectrum of operations against a realistic and thinking enemy in a 
virtual environment. Personnel from the AFNIC Simulator Training 
Exercise Division, led by Major Russell Montante, gave cyberspace 
operators the opportunity to gain hands-on experience in protecting, 
defending and fighting in a safe realm without impact to operational 
networks.
    Technically educated U.S. citizens are a national resource--vital 
to national security, and essential to our ability to operate in, from 
and through the space and cyberspace domains. The Air Force provides 
world class space and cyberspace education and training that builds on 
our Airmen's secondary and university education. However, increasingly 
fewer of our Nation's students are pursuing science, technology, 
engineering, and math (STEM) degrees. As many STEM-educated 
professionals reach retirement age in this country, the lack of 
technically educated U.S. citizens creates serious shortfalls in many 
industries, which results in tough competition for this vital resource. 
As a Nation, we must comprehensively address this shortage in technical 
talent if we hope to maintain our advantage in an increasingly complex 
global environment.
 continue to take care of people--our most treasured asset, america's 
                           sons and daughters
    As AFSPC reaches our three goals, we remember that our first and 
highest priority is to support our Nation's warfighters in harm's way--
to give them the tools needed to fight and win as quickly and safely as 
possible. At the same time, we maintain a continuing focus on ensuring 
our military and their families have access to necessary services on 
the homefront.
    In Colorado Springs, AFSPC partnered with the local community on 
several initiatives. One element of this partnership is providing 
resources for those dealing with Post Traumatic Stress Disorder and 
Traumatic Brain Injuries as they transition to civilian life.
    This summer, the Los Angeles AFB Airman and Family Readiness 
Center, working with the Air Force Recovery Care Coordinator for 
California, intervened in the military out-processing of one of our 
highest decorated heroes. They guided him through the process to 
receive a medical retirement, vice separation, allowing for continued 
access to the medical care he needs to recover. The team also provided 
support when this quiet hero lost a family member in combat in 
Afghanistan.
    This spring, Colorado Springs is once again hosting the Warrior 
Games. These athletic endeavors allow wounded and seriously ill service 
members to incorporate sports training as a part of their overall 
transition and recovery plan. It is the command's privilege to support 
this event and help honor our Nation's Wounded Warriors.
    Unfortunately, not all of our warriors return home. This year AFSPC 
remembers two of our own who fell on the battlefield: Major Charles 
Ransom and Airman First Class Matthew Seidler. Their sacrifice serves 
as a very personal reminder that we owe our best efforts to our 
warfighters each and every day. We will never forget them and we pray 
that their families find comfort in their loved one's contribution to 
freedom.
                               conclusion
    The members of AFSPC have a passion about service to our Nation. 
Our professionals are innovative. They continue to provide the world 
class space and cyberspace capabilities for which AFSPC is known, and 
they have the courage to not only do the right things, but also to do 
things right. Our command is about producing excellence--every day. We 
believe passion, innovation and courage lead to that excellence. 
Because we operate in domains that reach well beyond the globe, our 
slogan is Excellence, Global and Beyond. It is truly a privilege to 
command AFSPC and I appreciate the opportunity to represent this great 
command before the subcommittee.

    Senator Nelson. General Formica.

STATEMENT OF LTG RICHARD P. FORMICA, USA, COMMANDER, U.S. ARMY 
SPACE AND MISSILE DEFENSE COMMAND/ARMY FORCES STRATEGIC COMMAND

    General Formica. Good afternoon, Mr. Chairman, Ranking 
Member Sessions. It is my privilege as the Commander of Army 
Space and Missile Defense Command to appear before your 
subcommittee again this year. I thank you for your continued 
support of our soldiers, civilians, and families.
    My intent today is to briefly outline for you the necessity 
of space-based capabilities to our Army, our Nation's force of 
decisive action.
    In the 2012 posture statement, the Army focuses on three 
areas: support to Afghanistan, responsible stewardship, and the 
leaner Army. Inherent to these focus areas and the building of 
the Army of 2020 is an increasing reliance on space. The Army 
is the biggest user of space-based capabilities which are 
critical to the conduct of unified land operations. If the Army 
wants to shoot, move, or communicate, it needs space.
    This reliance becomes more critical in an era of tight 
fiscal resources, smaller Army force structure, and potentially 
reduced forward presence. The Army works closely with the Air 
Force who is the executive agent for space and other agencies 
to define requirements and ensure future warfighters have 
access to the essential space capabilities General Shelton has 
laid out.
    As a partner of the joint space enterprise, the Army is 
also a provider of space-based capabilities. Let me summarize 
our command's contributions to the joint force through our 
three core tasks.
    Our first core task is to provide trained and ready space 
forces and capabilities to support today's operations. Our 
forces, comprised of Active, Guard, and Reserve soldiers and 
civilians, conduct global space operations to include access to 
wideband satellite communications, missile warning, space 
control, friendly force tracking, and geospatial intelligence 
analysis. We support Army operations with our space support 
teams. These forward-deployed men and women provide access to 
joint and national capabilities in order to meet our 
warfighters' needs. Since September 11, more than 70 teams have 
deployed support operations in Afghanistan and Iraq.
    Our second core task is to build the future space forces 
and capabilities for the Army of tomorrow. The development of 
operational concepts, adjustments to doctrine, conduct of 
analyses and studies, and improvements to our space training 
enable the Army to build and improve our future space forces.
    Our final core task is to provide the warfighter with 
space-related technologies that enable dominant advantages to 
the battlefield for the day after tomorrow. We focus our 
science and technology (S&T) efforts on capabilities that will 
bring maximum advances in our combat effectiveness. The Joint 
Capability Technology Demonstration (JCTD), enables us to find, 
demonstrate, transition, and transfer the best space 
operational concepts, technology solutions, and products. We 
have proposed three space-related JCTDs, two of which aim to 
provide economical nanosatellite capabilities to the tactical 
ground component warfighter. The third JCTD will develop a low-
cost launch system for nanosatellites. These have been approved 
by the Office of the Secretary of Defense (OSD) and we look 
forward to favorable consideration by Congress.
    In conclusion, as we become a leaner Army, space 
capabilities will be critical enablers to our ability to 
conduct unified land operations. Assured access to space and 
well-trained, experienced space professionals reduce the fog, 
friction, and uncertainty of warfare. As a command, we will 
remain disciplined stewards of our Nation's resources. This 
committee's continued support is essential in enabling us to 
maintain and further improve our space capabilities and provide 
the best trained space professionals to combatant commanders.
    I appreciate again the opportunity to speak on the value of 
space to our Army. I look forward to answering any questions 
you may have.
    Army Strong.
    [The prepared statement of General Formica follows:]
           Prepared Statement by LTG Richard P. Formica, USA
                              introduction
    Mr. Chairman, Ranking Member Sessions, and distinguished members of 
the subcommittee, thank you for your ongoing support of our soldiers, 
civilians, and families. After my initial appearance last year, I 
appreciate the opportunity to testify again before this subcommittee. 
Thank you also for your continued strong support of the Army and the 
key capabilities that space affords our warfighters. Your continued 
support is important as we pursue our joint efforts to provide critical 
space capabilities in support of our Nation, our fighting forces, and 
our allies.
    My role has not changed since my previous subcommittee appearance. 
I wear three hats that entail distinct responsibilities in support of 
our warfighters. First, as the commander of the U.S. Army Space and 
Missile Defense Command, I have Title 10 responsibilities to train, 
maintain, and equip space and missile defense forces for the Army. 
Second, I am the Army Service Component Commander (ASCC) to the U.S. 
Strategic Command (STRATCOM), or Commander, Army Forces Strategic 
Command. I am charged with the responsibility for planning, 
integrating, and coordinating Army forces and capabilities in support 
of STRATCOM missions. Third, I serve as the Commander of STRATCOM's 
Joint Functional Component Command for Integrated Missile Defense 
(JFCC-IMD), enabling me to leverage the capabilities and skill sets of 
the U.S. Army Space and Missile Defense Command/Army Forces Strategic 
Command (USASMDC/ARSTRAT).
    In my role here today as the Commander of USASMDC/ARSTRAT, I am 
honored to testify with these distinguished witnesses--all providers of 
critical space capabilities to the warfighter and essential 
contributors to the Joint space planning process and our Nation's 
continued advances to effectively operate in space.
    Within the Army, space operations and space-related activities are 
pursued as an enterprise and are not the exclusive domain of the 
USASMDC/ARSTRAT, or any other single functional proponent. However, the 
Chief of Staff of the Army has assigned USASMDC/ARSTRAT as the Army's 
proponent for space. In this role, we coordinate closely with the other 
members of the Army Space enterprise, particularly the Army 
Intelligence, Signal, and Topographic communities. We are increasingly 
engaged across the broader Army community to ensure space capabilities 
are maximized and integrated across our entire force and that potential 
vulnerabilities to our systems are mitigated to the greatest extent 
possible. We also collaborate with STRATCOM and its Joint Functional 
Component Command for Space (JFCC Space) and other members of the Joint 
community to provide trained and ready space forces and space-based 
capabilities to the warfighter. We also work closely with the 
acquisition developers in the other Services to ensure the development 
of systems that provide the best capabilities for ground forces.
    Within USASMDC/ARSTRAT, we strive to achieve three core tasks 
within the space arena:

         To provide trained and ready Space Forces and 
        capabilities to the combatant commanders--our operations 
        function that addresses today's requirements.
         To build future Space Forces--our capability 
        development function that is responsible for meeting tomorrow's 
        requirements.
         To research, test, and integrate space and space 
        related technologies--our materiel development function that 
        aims to advance the Army's and warfighter's use of space the 
        day after tomorrow.

    During my appearance last year, my desire was threefold: to outline 
the Army as a user of space capabilities; to articulate the Army's 
space strategy and policy; and to inform the committee about the Army 
as a provider of space capabilities. Today, within the context of my 
testimony from that appearance, I would like to again address the 
absolute necessity of space-based capabilities for our warfighters and 
to expand upon the above three core space tasks that our soldiers, 
civilians, and contractors diligently execute each and every day.
       space-based products and capabilities--a force multiplier
    As I reported last year, our Army must be organized, trained, and 
equipped to provide responsive and sustained combat operations in order 
to fight as a joint team and to respond, as directed, to crises at home 
and abroad. The Army is dependent on space capabilities to execute 
unified land operations in support of the combatant commander's 
objectives. Army space forces contribute to the Army's ability to be 
adaptive, versatile, and agile to meet tomorrow's security challenges. 
In other words, space is critical to our ability to shoot, move, and 
communicate.
    The Army is the biggest user of space and it is also a provider of 
space-based capabilities. Integrating space capabilities enables 
commanders, down to the lowest echelon, to conduct unified land 
operations through decisive action and operational adaptability. The 
Army's Operating Concept identifies six warfighting functions that 
contribute to operational adaptability: mission command, movement and 
maneuver, intelligence, protection, fires, and sustainment. Space-based 
capabilities leveraged and employed across the Army space enterprise 
enable each of these warfighting functions. Virtually every Army 
operation relies on space capabilities to enhance the effectiveness of 
our force--there is no going back. In the coming years, our reliance on 
space capabilities will continue to grow. This reliance will be even 
more critical in an era of tight fiscal resources, a smaller force 
structure, and potentially a reduced forward presence. In essence, 
space-based capabilities are a force multiplier. When combined with 
other capabilities, space systems allow joint forces to see the 
battlefield with clarity, navigate with accuracy, strike with 
precision, communicate with certainty, and operate with assurance.
    The Army depends on space-based capabilities and systems, such as 
global positioning satellites, communication satellites, weather 
satellites, and intelligence collection platforms. They are critical 
enablers to our ability to plan, communicate, navigate, and maintain 
battlefield situational awareness, target the enemy, provide missile 
warning, and protect and sustain our forces. The Army and the Joint 
Forces require assured access to space capabilities and, when required, 
have the ability to deny our adversaries the same space-based 
capabilities.
    The Army works diligently with the Air Force and other agencies to 
define our requirements in order to ensure future warfighters have 
access to essential capabilities and services derived from space-based 
assets. Most of these services are so well integrated into weapon 
systems and support processes that many of our soldiers are unaware 
they are leveraging space capabilities in the daily conduct of their 
operations. This seamless integration is due in large part to the 
coordination and cooperation of space professionals across the National 
Security Space Enterprise at Air Force Space Command, the Joint 
Functional Component Command for Space, the Navy, the Army, and other 
Department of Defense (DOD) and joint agencies.
    As previously stated, the Army has been and continues to be a 
provider of space capabilities. In the past, the Army's greatest 
investment in space capabilities has been in the ground segment--the 
integration of space capabilities into operational forces through 
command and control systems, communication terminals, and intelligence 
feeds. Recently, the Army has strengthened and broadened its efforts to 
more fully exploit national and strategic space capabilities, defend 
our space capabilities, leverage space to enhance missile defense 
systems, and train and develop the needed space professionals and space 
enablers.
    In 2013, as in past years, the Army plans to invest significant 
resources, both funding and people, in pursuing space and space-related 
activities. The Army is evolving from a position of simply exploiting 
strategic space-based capabilities to one where the Army is fully 
engaged in the planning, development, and use of theater-focused 
operational and tactical space applications.
  provide trained and ready space forces and capabilities to today's 
                               operations
    Within our first core task of providing trained and ready space 
forces and capabilities to the combatant commanders (COCOMs) and the 
Warfighter, there are numerous recurring operations, capabilities, and 
training responsibilities that we provide each day. Within our 1st 
Space Brigade, over 1,000 soldiers and civilians provide space 
capabilities via access to space-based products and services that are 
essential in all phases of combat operations. The Brigade, a multi-
component organization comprised of Active, National Guard, and U.S. 
Army Reserve soldiers, has space forces assigned world-wide that are 
responsible for conducting continuous global space support, space 
control, and space force enhancement operations. The Brigade's three 
battalions support combatant commanders by providing satellite 
communications, space operations, missile warning, and forward-deployed 
space support teams. These Space Operations Officers, along with 
members of the Army's Space Cadre, directly influence the execution of 
strategic operations in support of operational and tactical level 
ground maneuver forces. Their principal duties include planning, 
developing, resourcing, acquiring, integrating, and operating space 
forces, systems, concepts, applications, or capabilities in any element 
of the DOD space mission areas.
    The Army Space Personnel Development Office (ASPDO), part of 
USASMDC/ARSTRAT, develops policies, procedures, and metrics for the 
Army Space Cadre and executes the life-cycle management functions of FA 
40 Space Operations Officers. The Army's Space Cadre, initiated in 2007 
and utilizing FA40s as its foundation, is comprised of over 2,300 
soldiers and civilians who perform space and space-related functions in 
support of the Army's interests in space operations, capability 
development, materiel development, and policy. The Cadre consists of 
soldiers and civilians from a wide variety of branches, career fields, 
disciplines, and functional areas.
    The approximately 410 multi-component FA 40s serve in Army and 
joint commands and organizations across all echelons--tactical, 
operational, and strategic. The Army continues to integrate space 
professionals into the Office of the Secretary of Defense, the Joint 
Staff, the North American Aerospace Defense Command, the U.S. Strategic 
Command, the Air Staff, the Air Force Space Command, and other space 
focused organizations and academic institutions. In each of these 
organizations, personnel not only provide the Army perspective of space 
related capabilities, they articulate requirements from a ground 
component standpoint in the joint environment. A summary of the 
critical space capabilities provided by Army's space professionals is 
highlighted below.

         Army Space Support Teams: During the current 
        Afghanistan operations, the USASMDC/ARSTRAT's Army Space 
        Support Teams continuously provide space-based products and 
        services to combatant commanders and other international 
        government agencies. The teams are on-the-ground space experts, 
        pulling key commercial imagery, forecasting the impact of space 
        weather, and providing responsive space support to their units. 
        Forward deployed Army space forces support the new defense 
        strategy by providing rotational presence and advisory 
        capabilities in support of broader security operations. The 
        bottom line is these teams bring tailored space products and 
        capabilities that meet critical theater commander's needs. 
        During the Iraq operations, Army Space Support Teams provided 
        essential space capabilities for those commanders and 
        warfighters. More than 70 teams have deployed in support of 
        Operations Enduring Freedom and Operation Iraqi Freedom in 
        order to provide invaluable on-the-ground responsive expertise 
        to combatant commanders and the warfighter.
         Satellite Communications: USASMDC/ARSTRAT's role in 
        satellite communications (SATCOM) has grown beyond our payload 
        operations and transmission control responsibilities for the 
        Defense Satellite Communication System (DSCS) and the Wideband 
        Global SATCOM System (WGS) constellations. We also serve as the 
        Consolidated SATCOM System Expert for the DOD narrowband and 
        wideband SATCOM constellations--the DSCS, the WGS, the Mobile 
        User Objective System (MUOS), the Ultra-High Frequency (UHF) 
        SATCOM, and the Fleet Communications Satellite. Transmission 
        control for more than 97 percent of DOD-owned SATCOM bandwidth 
        is provided by Army operators controlling the payloads on the 
        DSCS and the WGS. These systems provide critical SATCOM 
        capability for Combatant Commanders, other Federal agencies, 
        the Diplomatic Corps, the White House, and now allied nations 
        in accordance with recent international agreements extending 
        our cooperation in SATCOM operations. The 1st Space Brigade's 
        53rd Signal Battalion and Department of the Army civilians 
        perform this mission via the Wideband Satellite Communications 
        Operations Centers and DOD's Regional Satellite Communications 
        Support Centers located around the globe. A new Wideband 
        Satellite Communications Operations Center opened in Hawaii 
        last year, and just this month, we completed the lifecycle 
        replacement of essential equipment and infrastructure at our 
        Fort Detrick, MD, satellite operations facility. Construction 
        on the replacement for our facility at Fort Meade, MD, is 
        underway and the construction at our site in Landstuhl, Germany 
        will begin soon. The operations centers required modernization 
        and replacement of aging antennas and terminal equipment in 
        order to be compatible with the fleet of new and expanding WGS 
        assets being acquired and launched by the Air Force, and to 
        ensure the continued operation of the regional management hubs 
        for a majority of the DOD's satellite communications 
        capabilities. As the SATCOM System Expert for MUOS, the Army is 
        responsible for DOD's use of our next generation tactical 
        system which will transform tactical SATCOM from radios into 
        secure cellular networked communication tools. During this past 
        year, our Satellite Support Centers participated in numerous 
        worldwide operations and exercises, including Enduring Freedom, 
        New Dawn, Odyssey Dawn/Unified Protector, Tomodachi, and other 
        operations.
         Friendly Force Tracking: USASMDC/ARSTRAT operates the 
        DOD's Friendly Force Tracking Mission Management Center (MMC) 
        on behalf of STRATCOM. The MMC provides situational awareness 
        of U.S. military and other government personnel, along with 
        coalition and allied partners. Translating more than one and a 
        half million location tracks a day, this capability is an 
        essential enabler for our force. As the Army has the greatest 
        number of warfighters and systems to track on the battlefield, 
        our friendly force tracking assets are critical in identifying 
        friendly forces during unified land operations.
         Ballistic Missile Early Warning: Critical to the Joint 
        Force Commander's theater force protection, the Army provides 
        ballistic missile early warning and missile defense support 
        from within the theater or region. The 1st Space Brigade's 
        Joint Tactical Ground Stations (JTAGS) Detachments, operated by 
        Army personnel, monitor enemy missile launch activity and other 
        infrared events of interest and share the information with 
        members of the air and missile defense and operational 
        communities. Our JTAGS Detachments are forward-stationed across 
        the globe, providing 24/7/365 dedicated, assured missile 
        warning to STRATCOM for deployed forces.
         Geospatial Intelligence (GEOINT) Support: The Army 
        provides geospatial intelligence production in direct support 
        of the combatant commands, as an operational element of the 
        National System for Geospatial Intelligence. The Army's space 
        and intelligence experts perform exploitation of a variety of 
        commercial, civil, and DOD imagery data derived from space and 
        airborne sources. Additionally, they aid in the exploration of 
        emerging spectral system technologies and in transitioning new 
        capabilities to the warfighter. Last fall, USASMDC/ARSTRAT 
        activated a new GEOINT branch to support STRATCOM's mapping 
        requirements. In 2011, we provided geospatial situational 
        awareness in support of Hurricane Irene and the Japanese 
        earthquake relief efforts as well as crisis support operations 
        around the globe including North Atlantic Treaty Organization 
        operations in Libya--Operation Unified Protector. We also 
        provided almost 100,000 unclassified commercial imagery 
        products to U.S. Strategic Command, U.S. Northern Command, U.S. 
        Central Command, the State Department, and other agencies.
         Operations Reach-back Support and Services: The 
        USASMDC/ARSTRAT Operations Center, located at Peterson Air 
        Force Base in Colorado Springs, CO, provides reach-back support 
        for our space experts deployed throughout the operational force 
        and allows us to reduce our forward-deployed footprint. This 
        center maintains constant situational awareness of deployed 
        elements, continuously responds to requests for information, 
        and provides the essential reach-back system of connectivity 
        with technical subject matter experts.
         Tactical Exploitation of National Capabilities: The 
        Army Special Programs Office is the Army's focal point for the 
        exploitation of national intelligence, surveillance, and 
        reconnaissance assets and products through the Tactical 
        Exploitation of National Capabilities program. The Army is 
        fully integrated into the National Reconnaissance Office and 
        the Intelligence Community.
         Strategic Space Surveillance: The Army also operates 
        facilities and assets that are of utmost importance to 
        protecting the Nation's use of space. The U.S. Army Kwajalein 
        Atoll/ Reagan Test Site (RTS), located in the Marshall Islands, 
        is a national asset that provides unique radars and sensors 
        that contribute to STRATCOM's space situational awareness 
        mission, enabling protection of the Nation's manned and 
        unmanned space assets.
       build future space forces--meeting tomorrow's requirements
    The Army's ever increasing dependency on space-based capabilities 
requires active participation in defining space-related requirement 
needs. The identified needs serve to ensure necessary Joint force 
structure, systems, and concept of operations (CONOPs) are developed 
and acquired, thereby enabling the land force to conduct the full range 
of military operations now and in the future. Ensuring tactical and 
assured access to space is our focus--reassuring the requisite 
capabilities and effects are delivered to the tactical warfighter on 
time, every time demands that our space capabilities and architectures 
become more resilient against attacks and disruption. We must ensure 
that our Army does not face a day without space and space-related 
capabilities.
    In our second core task of building future space forces, we use our 
capability development function to meet tomorrow's space requirements. 
As reported last year, the Army uses established and emerging processes 
to document its space-based needs and pursue Army and Joint validation 
of its requirements. This disciplined approach helps ensure limited 
resources are applied where warfighter operational utility can be most 
effectively served. As a recognized Army Center for Analysis, USASMDC/
ARSTRAT conducts studies, in conjunction with the Army and the other 
Services, to determine how best to meet Army space requirements. With 
this information, we continue to pursue and develop the necessary 
adaptability across the Doctrine, Organization, Training, Materiel, 
Leadership and Education, Personnel, and Facilities (DOTMLPF) to 
mitigate threats and vulnerabilities while sustaining land force 
operations.
    The Army's Space Policy, published in 2009, focuses on the 
operational and tactical needs of land forces and assigns space related 
Army organizational responsibilities. It follows implemented DOD space 
policies and procedures, reestablishes objectives for Army space, and 
continues the Army Space Council. The Army's Space Policy outlines four 
broad space related objectives:

         Maximize the effectiveness of current space 
        capabilities in support of operational and tactical land 
        warfighting needs.
         Influence the design, development, acquisition, and 
        concepts of operation of future space systems that enable and 
        enhance current and future land forces.
         Advance the development and effective use of 
        responsive, timely, and assured Joint interoperable space 
        capabilities.
         Seamlessly integrate relevant space capabilities into 
        the operating force.

    In May 2011, the Chief of Staff of the Army approved the Army's 
Space Strategic Plan. This document, which was shaped by national level 
guidance such as the National Space Policy and the National Security 
Space Strategy, outlines the Army's space enterprise path for strategic 
planning, programming, and resourcing.
    The essence of our space strategy and the guiding vision of the 
Army space enterprise are to assure access to resilient and relevant 
space-enabled capabilities to ensure Army forces can conduct unified 
land operations. To achieve this, our space strategy rests on three 
tenets that link Army strategic planning and programming for space to 
the guidance in national and DOD space policy and strategy. The three 
essential tenets are:

         To enable the Army's enduring mission by providing 
        requisite space-enabled capabilities to support current 
        operations, as well as future transformation efforts.
         To leverage existing DOD, national, commercial, and 
        international space-based capabilities.
         To pursue cross-domain solutions to create a resilient 
        architecture to mitigate threats, vulnerabilities, and assure 
        access to critical capabilities needed to sustain land force 
        operations.

    To properly train space professionals, the Army developed the Space 
Operations Officer Qualification Course and the Army Space Cadre Basic 
Course. These two courses provide the necessary foundation for the 
Space Cadre. The Army has come a long way since the first Space 
Operations Officer Qualification class in 2001. Today, through USASMDC/
ARSTRAT's Directorate of Training and Doctrine, we conduct space 
training via resident, mobile training teams, and distributed learning 
venues to support initial skills and qualification training, leader 
development, lifelong learning and professional development in support 
of life cycle management.
    The Army also leverages the high-quality space training developed 
and administrated by the Air Force. Finally, numerous space officers 
complete additional post-graduate studies at the Naval Postgraduate 
School, accredited civilian institutions, and training with industry. 
The Army is committed to growing, training, developing, tutoring, and 
advancing space professionals. In 2011, the Army Space Council assigned 
USASMDC/ARSTRAT the task to execute an Army-level initiative and 
incorporate space knowledge and leader development training into all 
Army Schools. We are leading this effort with support from the U.S. 
Army Training and Doctrine Command (TRADOC) and are researching and 
identifying gaps in space knowledge training at the Centers of 
Excellence and associated schools. Once completed, the analytical 
results will help us define the what and how of soldier space knowledge 
training and facilitate the integration of that space knowledge 
training into existing lessons and school curricula.
    Our Battle Lab continues to find new ways to exploit space 
capabilities, to bring more space-based products to the tactical 
warfighter and integrate them with Army network capabilities. Via a 
Joint effort between Air Force Space Command and USASMDC/ARSTRAT, we 
have developed a way to provide situational awareness of Space 
capabilities to the tactical user, via a handheld tablet device, 
similar to an iPad. Prototype iSpace tablets are currently in the hands 
of deployed Army space professionals while specialized variants are 
being used by deployed Army Special Operations soldiers.
   research, test, and integrate space and space related technologies
    Our final core task entails our materiel development function in 
which we seek to provide the warfighter with space and space related 
technologies that provide dominant advantages on the battlefield--
essential enhancements for the day-after-tomorrow. We realize that 
fiscal challenges will stress all modernization efforts. As such, we 
have focused our science and technology research, development, and 
demonstrations on capabilities that return maximal advances in our 
combat effectiveness. Recognition of the inextricable dependence of our 
weapon systems and battle command capabilities on orbiting spacecraft 
specifically highlights our determined effort to develop affordable 
spacecraft and launch systems which, in turn, will enable assured 
access to global reach from space. Our focus on affordability ensures a 
feasible means to field sufficient numbers of space systems to 
completely and effectively complement our active combat brigades.
    Despite the current and projected resource constrained environment, 
the Army recognizes the continued need to prioritize, leverage, and 
invest in promising space research and development technologies. As 
such, within our materiel development core task, we are striving to 
better utilize the Joint Capability Technology Demonstration (JCTD) 
Program. This will enable us to find, demonstrate, transition, and 
transfer the best operational concepts and technology solutions for 
transformational, Joint, and coalition warfare. Leveraging the JCTD 
program, I would like to briefly highlight three small satellite 
technology endeavors that have the potential to provide enhanced space 
capabilities to the ground commanders and warfighters.

         SMDC Nanosatellite Program-3 (SNaP-3): Constellations 
        of highly affordable nanosatellites deployed in mission-
        specific, low earth orbits can provide a cost effective, 
        beyond-line-of-sight data communications capability for users 
        who currently have no access to satellite communications. SNaP-
        3, an Office of the Secretary of Defense (OSD) approved JCTD, 
        seeks to utilize three of these small satellites to provide 
        dedicated coverage to a wide range of under-served users in 
        remote areas. Pending final approval of the JCTD, the Army will 
        build and launch three nanosatellites to address the current 
        shortfall. We are hopeful this initiative will transfer to a 
        program of record in fiscal year 2014.
         Kestrel Eye Visible Imagery Nanosatellite: New 
        technologies are enabling the production of low-cost 
        nanosatellites which have ever increasing military utility. 
        Kestrel Eye, an OSD approved JCTD, is an endeavor to 
        manufacture an electro-optical near-nanosatellite-class imagery 
        satellite that can be tasked directly by the tactical ground 
        component warfighter. Weighing about 30 pounds and capable of 
        producing 1.5 meter resolution imagery, Kestrel Eye's data will 
        be down-linked directly to the same warfighter via a data relay 
        system that is also accessible by other warfighters in theater 
        without any continental United States relay pass-through or 
        data filtering. At the low cost of about $1 million per 
        spacecraft in a production mode, the intent is to demonstrate a 
        small, tactical space-based imagery microsatellite that could 
        be propagated in large numbers to provide a cost effective, 
        persistent capability to ground forces. Each satellite would 
        have an operational life of greater than 2 years in low earth 
        orbit. Pending final JCTD approval, the initial Kestrel Eye 
        launch is scheduled for next year.
         Soldier-Warfighter Operationally Responsive Deployer 
        for Space (SWORDS): Concurrent with the shrinking size and cost 
        of militarily useful satellites is a need for an appropriately 
        sized and priced launch system. SWORDS, an OSD approved JCTD, 
        is an initiative to develop a very low cost launch vehicle. 
        This launch system is designed to take advantage of low cost, 
        proven technologies, and non-exotic materials to provide launch 
        for small weight payloads to low earth orbit for about one 
        million dollars per launch vehicle. SWORDS is low cost because 
        it is very simple: it is an integrated tank/booster/engine 
        design; it has a benign bi-propellant liquid propulsion system; 
        and it uses existing launch support and launch site hardware.
                               conclusion
    The Army is and will grow more dependent upon the capabilities that 
space brings to the battlefield. In current and all future conflicts, 
space capabilities will be inextricably linked to warfighting. The Army 
will continue to rely on and advocate for space products and services 
provided by the DOD, other government agencies, our allies and 
coalition partners, and commercial entities in order to shoot, move, 
and communicate. The Army's goal is to continue to provide trained and 
ready space forces and capabilities to the combatant commanders and the 
warfighter, build future space forces, and research, develop, test, and 
integrate future space capabilities. Fully integrated capabilities will 
provide depth, persistence, and reach capabilities for commanders at 
the strategic, operational, and tactical levels. Assured space systems 
and well-trained and experienced space professionals significantly 
reduce the fog, friction, and uncertainty of warfare. Our use of and 
reliance on space is integral and absolutely critical to the Army's 
successful defense of this Nation. This committee's continued support 
is essential in enabling us to maintain and further improve our space 
capabilities and provide the best-trained space professionals to 
combatant commanders. The courageous warfighters that serve to protect 
the safety and welfare of our Nation deserve nothing less.
    I appreciate having the opportunity to speak on these important 
matters and look forward to addressing any questions you may have. 
Secure the High Ground and Army Strong!

    Senator Nelson. Thank you, General.
    Mr. Winokur.

   STATEMENT OF ROBERT S. WINOKUR, DIRECTOR OF OCEANOGRAPHY, 
  SPACE, AND MARITIME DOMAIN AWARENESS, DEPARTMENT OF THE NAVY

    Mr. Winokur. Thank you, Mr. Chairman, Senator Sessions. I 
appreciate the opportunity to be here in my role as Acting 
Oceanographer for the Navy and Director of Oceanography, Space, 
and Maritime Domain Awareness.
    Our Navy requires access to a combination of joint 
interagency, commercial, and international satellite systems 
for information dominance and synchronized safe operations. 
These space-based assets provide critical communication paths, 
PNT signals, environmental data, and intelligence, 
surveillance, and reconnaissance (ISR) assets. Space 
capabilities enable effective command and control, 
responsiveness, and agility necessary for a globally engaged, 
superior naval force consistent with emphasis on forward 
operations and joint interoperability.
    The Navy depends on others within DOD to acquire sufficient 
wideband communication satellites to meet the variety of needs 
in these bands. However, as the executive agent for narrowband 
satellite communications, it is the Navy that supplies the 
necessary narrowband capabilities to meet joint force 
requirements.
    The increasing demand for narrowband satellite 
communication (SATCOM) access at ever-higher data rates 
requires moving beyond legacy ultra-high frequency (UHF) 
satellite capabilities. While the MUOS will carry a legacy UHF 
payload for near-term usage, most importantly, it will increase 
future user capacity by over 10 times through its wideband 
signal. MUOS will also connect users to the Defense Information 
Systems Network, resulting in worldwide tactical narrowband 
netted point-to-point and broadcast voice and data services in 
challenging environments.
    The first of five MUOS satellites launched on February 24th 
is well on its way to meet its scheduled on-orbit capability in 
May. The second spacecraft is on track for a November 2012 
delivery and has a tentative launch date of July 2013. 
Assembling and testing of the third spacecraft is nearly 
complete.
    Additionally, the radio access facility in Hawaii and the 
Naval Satellite Operations Center in Point Magoo, CA, have 
received the necessary upgrades for initial operation of MUOS.
    Navy optimized the UHF SATCOM constellation to ensure joint 
staff requirements are met in legacy UHF payload capacity, even 
in the event of an unplanned loss. Measures included 
enhancements in existing DOD systems, leases with commercial 
companies, and a memorandum of understanding with the 
Australian Ministry of Defense for use of channels on an 
Australian-hosted payload. Based on the improvements already 
employed, the recent successful launch of MUOS-1 and the 
statistical reliability analysis of the legacy UHF SATCOM 
constellation's lifespan, Navy does not foresee a need for 
additional legacy capacity.
    The GPS is the Navy's primary source of precise PNT, data 
for platforms, munitions, combat, and C4I systems. Last summer, 
Navy awarded a multiyear contract for its follow-on shipboard 
PNT distribution system. The new GPS PNT service will replace 
decades-old, legacy systems incorporating the latest security 
architecture, redundant clocks, and anti-jam antennas.
    Space-based operations are an essential element to Navy's 
global atmospheric and ocean numerical models, relying on 
partnerships with the Air Force, civil, and international 
organizations to meet our space-based environmental sensing 
requirements. To this end, the Navy is engaged in defining 
requirements for the follow-on to the Defense Meteorological 
Satellite Program.
    By using a variety of space-based assets, we are providing 
greater maritime domain awareness, leading to more efficient 
defenses from threats to safety and commerce. Navy continues to 
engage the intelligence community as they explore future 
acquisitions and consider the capabilities of commercial 
vendors to meet Federal ISR needs.
    In closing, I would like to reiterate that the Navy is 
heavily reliant upon space assets for success in the maritime 
domain. In the face of today's fiscal realities, this requires 
balancing investments and new acquisitions, training in the use 
of existing assets, and continued examination of alternatives 
to provide sound operations and acquisition options.
    Mr. Chairman, we look forward to answering any questions 
you and the subcommittee may have. Thank you.
    [The joint prepared statement of Mr. Winokur and Dr. 
Zangardi follows:]
   Joint Prepared Statement by Mr. Robert S. Winokur and Dr. John A. 
                                Zangardi
                              introduction
    Mr. Chairman, distinguished members of the subcommittee, we are 
honored to appear before you today to address the Navy's space 
activities. Navy's forward and geographically-dispersed operations 
underlines the importance of a healthy satellite constellation and 
assured access to those capabilities that support getting the necessary 
information to leadership in a timely manner to inform decisions at 
tactical, operational, and strategic levels. The space constellation 
brings synchronization of guidance and objectives between the shore-
based headquarters and the forward-deployed Fleet, incorporates the 
tactical picture of each asset forward into a global common operational 
picture for increased awareness, and allows orchestration of operations 
amongst the detached units.
    The Defense Strategic Guidance, released in January 2012, directs a 
rebalancing toward the vast Asia-Pacific region, due to the United 
State's ``inextricably linked'' economic and security interests with 
countries in East and South Asia and the Western Pacific. The 30th 
Chief of Naval Operations, Admiral Jonathan Greenert, delivered his 
Sailing Directions in September 2011, directing the Navy to place 
warfighting principles and capabilities first, to operate forward, and 
to be ready to employ all Navy resources to accomplish assigned 
missions. The continued emphasis in forward operations combined with 
the re-emphasis on the global nature of U.S. security interests require 
Navy position itself to take full advantage of the critical benefits 
afforded from space. It also demands Navy continue to work with the 
other Services to develop and refine the necessary tactics, techniques, 
procedures, and capabilities to maximize the use of available 
constellations and maintain continual access in degraded or denied 
space environments. Navy continues to recognize the need for space 
expertise as a guide in developing our space capabilities, and 
therefore is routinely examining its Space Cadre community management 
and optimizing its training and exercise regimen to strengthen Navy's 
ability to maximize the access to, and use of, these critical satellite 
constellations.
    Information Dominance and synchronized, safe operations in the vast 
domains of the global commons require access to a combination of joint, 
interagency, commercial, and international space systems providing our 
Navy commanders with critical satellite communications (SATCOM) paths; 
positioning, navigation, and timing (PNT) signals; environmental 
monitoring (EM) data; missile warning (MW); and intelligence, 
surveillance, and reconnaissance (ISR) reporting necessary for the full 
range of operations from humanitarian missions to combat operations in 
one or more theaters. Access to, and mastery in, operations utilizing 
this combination of space capabilities enables decisiveness, 
sustainability, responsiveness, and agility--critical requirements for 
a globally engaged, superior naval force.
                  mobile user objective system (muos)
    SATCOM access is the backbone of space-based capabilities 
supporting Navy's geographically-dispersed, forward operations. It is 
the pathway across which commanders can provide updates and receive 
guidance from higher headquarters ``on the beach'' and synchronize 
operations with land-based and other distant Fleet assets. It is also 
an important path to disseminate critical MW, ISR, and EM information 
to forward-deployed ships, providing threat warning, situational 
awareness, and a solid foundation with which the operational or 
tactical commander can make sound decisions. Navy depends on others 
within the Department of Defense (DOD) to acquire sufficient wideband 
communications satellites to meet the variety of Navy missions 
requiring communications in these bands. As the Executive Agent for 
Narrowband Satellite Communications, Navy supplies the necessary 
narrowband capabilities to meet the total joint force requirements.
    The increasing joint demand for narrowband SATCOM access at ever-
higher data rates requires moving beyond antiquated legacy UHF 
satellite capabilities. The Mobile User Objective System, or MUOS, will 
use a wideband code division, multiple access (WCDMA) capability, 
similar to third generation (3G) cellular telephones, that will satisfy 
those demands by providing over 10 times the capacity of the current 
UHF Follow-On (UFO) satellite constellation. With this capability and 
the increased capacity, MUOS will support Unified Commands and Joint 
Task Force Components, DOD and non-DOD agencies, and our coalition 
partners by providing worldwide tactical narrowband netted, point-to-
point, and broadcast voice and data services in challenging 
environments, including double-canopy foliage, urban environments, high 
sea states, and all weather conditions.
    Over the past year, the MUOS program made significant progress. The 
first MUOS satellite in the planned constellation of five satellites 
launched on February 24, 2012, and is scheduled for on-orbit capability 
in May 2012. Ground infrastructure improvements are completed for the 
initial MUOS capability, as is training of the operators at Naval 
Satellite Operations Center, who will be responsible for on-orbit 
maintenance and operation of the constellation. The second spacecraft 
is assembled and undergoing spacecraft level integrated testing. It is 
on track for a November 2012 delivery to the government and has a 
tentative launch date of July 2013, as assigned by the Air Force. 
Assembly and system level testing of the third spacecraft is nearly 
complete, and the program projects its on-time delivery for an 
anticipated fiscal year 2014 launch.
    With the launch of MUOS 1, the Department of Defense (DOD) begins 
its transition to a new UHF SATCOM capability based on 3G cellular 
telephone technology; however it will take time to launch the full 
constellation and shift the thousands of DOD UHF SATCOM users to this 
new technology. This transition will be made smooth through a number of 
proactive measures to extend access to the legacy UHF signals. First, 
each MUOS satellite has a legacy UHF payload that will be accessible by 
current UHF radios and will remain available throughout the satellite's 
lifetime. Navy also optimized the UHF SATCOM constellation to 
significantly increase the number of available channels and implemented 
the Integrated Waveform, a software upgrade to UHF SATCOM tactical 
terminals and control systems, to optimize the use of legacy UHF 
satellite channels. Navy continues to leverage commercial legacy UHF 
capabilities through leases directly with commercial companies and 
through a Memorandum of Understanding with the Australian Ministry of 
Defense for use of channels on an Australian hosted payload. Navy has 
explored additional options using commercially hosted payloads, but 
based on the improvements already employed, the recent successful 
launch of MUOS 1, planned future launches of the subsequent MUOS 
satellites, and the projected lifespan of the legacy UHF SATCOM 
constellation, Navy does not foresee a need for any additional legacy 
capacity now or through MUOS's projected lifecycle.
    The final piece in realizing the full capability of MUOS is the 
fielding of MUOS-capable Joint Tactical Radio System (JTRS) terminals 
and by upgrading existing legacy UHF software programmable terminals to 
give access to the WCDMA waveform. Due to cost overruns and schedule 
delays, the MUOS compatible terminals of the JTRS program were reduced 
to the Handheld, Manpack, Small Form Fit (HMS) Manpack radio and the 
Airborne, Maritime, Fixed Station (AMF) Small Airborne radio versions. 
Recently, the Office of the Secretary of Defense made Navy responsible 
for systems engineering and integration of the end to end MUOS 
capability to include ensuring compatible user terminals are developed. 
Navy has appointed the MUOS Program Manager as the government 
development and integration lead and is implementing additional early 
end to end testing of the new MUOS capability in order to maximize the 
successful operational deployment of MUOS-capable JTRS terminals when 
fielded. With this new direction, Navy expects the JTRS HMS program to 
have the HMS Manpack certified and ready for testing in late fiscal 
year 2013, in time to conduct the operational evaluation of the MUOS 
satellite system in fiscal year 2014.
    With five programmed satellites on orbit, MUOS will be the common 
denominator for future narrowband command and control, enhancing the 
capability to communicate from the tactical edge to theater 
headquarters. MUOS will allow more comprehensive and coordinated 
support to regional engagement efforts, providing the capability to 
synchronize actions with other Services and agencies.
                                tacsat-4
    The level of importance that Navy places on SATCOM access directs 
the exploration of a variety of measures to counter anti-access and 
area denial efforts of potential adversaries. Navy is examining signal 
processing techniques that can be employed in the architectures of 
already on orbit satellites to maintain access to their signals in a 
degraded or denied space environment. Navy is also looking at 
technology that can be placed on satellites that are still under 
construction to give us an on-orbit capability.
    On September 27, 2011, Navy launched Tactical Satellite 4 (TacSat-
4) to examine another tenant of space resiliency, that of operationally 
responsive space launches. TacSat-4 is a fourth-generation 
microsatellite funded by the Office of Naval Research and developed by 
the Naval Research Laboratory in response to a U.S. Marine Corps 
requirement for satellite communications ``on the move'' and Navy's 
requirement for rapid replenishment of SATCOM. Since launch, TacSat-4 
has undergone, and continues to undergo, testing by the Navy, Marine 
Corps, Army, and Coast Guard, as well as the Canadian and British 
militaries, to better understand its true military utility in providing 
communications access to ground units in urban and mountainous terrain, 
ships and submarines on the high seas, and even units operating in the 
polar regions where traditional SATCOM satellites in geosynchronous 
orbits cannot reach. TacSat-4's inclined low-earth orbit, somewhat 
atypical for SATCOM satellites, is also being studied for its potential 
benefit for data exfiltration from ground and oceanographic sensors.
               positioning, navigation, and timing (pnt)
    The Air Force's NAVSTAR Global Positioning System (GPS) continues 
to be Navy's space-based signal source for precise PNT data for 
platforms, munitions, combat systems and command, control, 
communications, computer, and intelligence systems. Received and 
processed by Navy GPS receivers, it allows for precise navigation to 
ensure safe operations in, under, and above the seas. It provides 
accurate location data for guided munitions to ensure precise delivery 
to the target, minimizing inaccurate attacks that can often result in 
greater collateral damage. These, and many more benefits Navy enjoys 
from PNT data, underscore Navy's emphasis in maintaining user access to 
this capability, even in anti-access and area denial efforts of our 
adversaries.
    Last summer, Navy awarded a multi-year contract to Raytheon 
Integrated Defense Systems for its follow on shipboard PNT system. The 
new system, GPS-based PNT Service (GPNTS), will replace legacy GPS user 
systems dating from the 1980s and 1990s. GPNTS will incorporate the 
latest GPS security architecture and feature redundant clocks and anti-
jam antennas. Additionally, it will serve as a major stepping stone for 
Navy's transition to the new GPS M-code signal.
    Navy is also undertaking an initiative to improve our critical 
shore-based timing services by implementing a common architecture that 
will improve assured time and frequency services. Additionally, Navy, 
as the DOD manager for Precise Time and Time Interval, is working 
closely with the Air Force to ensure the U.S. Naval Observatory's 
Master Clock is fully supportive of the new GPS III architecture.
                        environmental monitoring
    Navy provides DOD with global atmospheric modeling and global and 
regional ocean modeling. We rely on partnerships with the Air Force, 
civil, and international agencies to meet our space-based environmental 
sensing requirements. Meeting these requirements is critical to the 
planning for and execution of safe, effective military operations. To 
this end, the Navy is engaged in defining the requirements for the 
follow-on to the Defense Meteorological Satellite Program (DMSP).
    As stated in last year's testimony, Navy deferred procurement of an 
altimeter satellite, GEOSAT Follow-On 2 (GFO-2), until fiscal year 
2016, assuming risk in antisubmarine warfare and mine warfare areas in 
exchange for increased emphasis in areas deemed of greater importance 
to DOD. However, with the 2012 emphasis on forward operations in the 
Pacific and Indian Oceans, Navy has altered its planning assumptions 
and must reduce risk in antisubmarine warfare and mine warfare through 
an assured source of space-based altimetry data, critical data for 
battlespace awareness and planning undersea warfare operations. Navy is 
considering all options to meet this altimetry requirement, from GFO-2 
to civil or international partnerships consistent with Presidential 
Policy Directive 4.
   missile warning and intelligence, surveillance, and reconnaissance
    Space-based assets can provide unique access to information 
critical to decision making throughout the range of military 
operations, whether it is insight into potentially hazardous areas 
resulting from natural disasters or the preparatory activities of an 
emerging threat to U.S. and our partners' interests. The global 
maritime picture built by quilting together a variety of assets, 
including those that allow mapping ice boundaries in the polar regions 
and the EM assets that support other oceanographic studies, can result 
in greater maritime domain awareness and lead to more efficient 
defenses from seaborne threats to safety and commerce, as well as safer 
navigation for the world's merchant fleets.
    Navy continues to engage the Intelligence Community as they explore 
future acquisitions and consider the capabilities of commercial vendors 
to meet the ISR needs of the U.S. Government. Navy's relationship 
building fosters better understanding throughout the Intelligence 
Community of the unique ISR requirements in the maritime domain, 
improving the accuracy of factoring Navy requirements into acquisition 
decisions and the probability of them ``making the cut.'' These 
requirements can vary significantly from the traditional ISR 
collections of terrestrial targets to which we have become accustomed 
and, thus, require extra emphasis and explanation. For example, terrain 
such as mountains and river crossings can help focus collections on 
mobile, land-based elements, but maritime vessels of interests have 
greater freedom of movement and, therefore, require a much broader area 
surveillance method and more frequent revisits to maintain a credible 
and reliable track. In support of this, Navy, under Presidential Policy 
Directive-4 (PPD-4), the National Space Policy, is working with 
partners to foster international collaboration using civil and 
commercial space systems to enhance global maritime domain awareness. 
The recommended program has three major facets: Harmonization, 
Operational Cooperation and Experimentation, and Influencing Technology 
Development, through which it will achieve the advantages of increased 
persistence, increased coverage, and reduced cost.
    To complement the efforts to build requirements into future 
systems, Navy continues to leverage its Tactical Exploitation of 
National Capabilities Branch and various research labs to explore new 
methods in which we can use the current, traditional data collection 
systems in often nontraditional manners or in an atypical combination 
of sources to meet these unique requirements. These efforts are paying 
dividends, but more work and investment in the research and development 
of such techniques is necessary. As budgets continue to decline, it 
will be these efforts in non-traditional processing and exploitation, 
combined with ensuring future architectures take into account the 
unique maritime ISR requirements, that will give Navy the necessary, 
timely intelligence to make the right decision within realistic time 
constraints.
                            navy space cadre
    Key to Navy's development and full exploitation of space-based 
capabilities is our Space Cadre. As Navy continues to operationalize 
space amongst the Fleets and develop its capabilities to maintain 
access to the critical functions our Nation's space constellations 
provide, Navy will rely on its Space Cadre to lead the development of 
tactics, techniques, and procedures (TTPs) unique to the maritime 
domain. Deployed forces need these TTPs to take full advantage of the 
benefits space provides and maintain critical warfighting functions 
despite the anti-access and area denial efforts of future adversaries. 
Development of this expertise requires formal education, intense 
training, and challenging exercises. Navy continues to integrate space 
awareness training into core training opportunities throughout the 
Information Dominance Corps and in pre-deployment training for Strike 
Group staffs. This broad training raises general awareness throughout 
the Navy of available capabilities and how to take full advantage of 
all DOD space assets.
    From this baseline, Navy grows an experienced group of people 
identified as Space Cadre who receive advanced education in space 
operations, technology, and engineering and are placed in specific 
space-related jobs to assist in translating Navy requirements to the 
joint force. The unique needs of maritime domain operations are often 
not intuitively obvious to those more experienced in land-based 
operations, so placement of these ``translators'' at key acquisition 
and space operations billets ensures appropriate advocacy for the 
unique requirements for space-based capabilities to support maritime 
operations.
    Finally, Navy is incorporating more demanding scenarios in Strike 
Group and other pre-deployment exercises to increase the Fleet 
experiences in operating in degraded or denied space environments. 
These exercises give the Fleet a chance to test TTPs and transform them 
from something read in a publication to a second-nature reaction to 
maintain access to those key space capabilities the Navy needs to 
execute our assigned missions.
                               conclusion
    The Navy is heavily reliant upon space for mission enhancement from 
SATCOM, PNT, MW, EM, and ISR assets to communicate with, and provide 
valuable information to, our commanders and leadership at sea and 
ashore to inform their decisions and guide maritime operations. This 
requires balancing investments in new acquisitions, additional training 
in the use of already available assets, and continued development of a 
Space Cadre core that can examine alternatives and provide sound 
operations and acquisition recommendations to leadership, especially 
within the bounds of today's fiscal realities. Navy will continue to 
consider the threat posed to these critical resources by those 
developing cutting-edge space denial technologies and the probability 
of their use against the United States as we examine the balance 
between the cost, benefit, and investment timing into necessary 
capabilities to protect our access to space constellations and ensure 
our forward-deployed commanders have the tools necessary to maintain 
information dominance and decision superiority.
    Mr. Chairman--thank you for the opportunity to share our efforts 
with you today. We look forward to answering any questions you and the 
subcommittee may have.

    Senator Nelson. Thank you.
    Dr. Zangardi.

 STATEMENT OF DR. JOHN A. ZANGARDI, DEPUTY ASSISTANT SECRETARY 
 OF THE NAVY FOR COMMAND, CONTROL, COMMUNICATIONS, COMPUTERS, 
        INTELLIGENCE, INFORMATION OPERATIONS, AND SPACE

    Dr. Zangardi. Good afternoon. Mr. Chairman and Senator 
Sessions, thank you very much for this privilege to speak 
before you today. I will keep my opening comments very brief.
    At last year's hearing, I was asked when the Navy believed 
the MUOS space vehicle number 1 would launch. I stated at that 
hearing that the Navy's projection was February 2012. I am 
pleased to inform you that MUOS space vehicle number 1 was 
launched Friday, February 24, from Cape Canaveral, FL. The 
satellite is currently in a geosynchronous orbit in its test 
slot over the Pacific.
    Deployments of the solar arrays and mesh antenna are 
complete. Payload testing has commenced and is ongoing. Both 
the UHF legacy package, test signals, and KA band signals are 
being received by the ground station. The MUOS Government and 
contractor team continues to execute the plan and the 
satellite's health and performance are as expected.
    After a 90-day on-orbit check, it will be handed over to 
Navy and be ready for legacy UHF SATCOM operations and the 
initial testing of the new wideband code division, multiple 
access capability, otherwise known as the MUOS waveform.
    The second satellite is assembled undergoing spacecraft 
level testing. Currently it is in its TVAC chamber. The second 
satellite is on track for November 2012 delivery.
    Space vehicle number 2 has been tentatively given a July 
2013 launch slot. We expect that to firm up here soon.
    The remaining three satellites are under a fixed-price 
incentive contract and are tracking both to cost and schedule 
at this time.
    The Navy will continue to focus on the successful roll-out 
of MUOS constellation. We will also continue to monitor the 
health of the UFO constellation to ensure essential UHF 
satellite communication services are provided to the 
warfighter.
    Sir, that ends my comments and I stand by to answer your 
questions. Thank you.
    Senator Nelson. Thank you.
    Ms. Chaplain.

 STATEMENT OF CRISTINA T. CHAPLAIN, DIRECTOR, ACQUISITION AND 
     SOURCING MANAGEMENT, GOVERNMENT ACCOUNTABILITY OFFICE

    Ms. Chaplain. Chairman Nelson and Senator Sessions, thank 
you for asking us to share our views on the military space 
acquisition programs.
    As I commented last year, the landscape for acquisitions in 
space has changed considerably over the past decade. If I were 
here 5 years ago, I would be talking about all the major 
programs having very large cost increases and schedule delays 
adding up to years. I would be talking about resistance to 
implementing best practices. I would also be talking about even 
a separate acquisition policy for space altogether. I would be 
talking about a lot of programs moving forward with a lot of 
technical and other kinds of unknowns, like requirements and 
cost. I would be talking about lax oversight. What we see today 
is that space programs do have some problems, but they are not 
to the same extent that we had a decade ago.
    Some of the systems we have concerns about do include the 
GPS III program which had an 18 percent cost increase for the 
first two satellites. So that one is on our watch list. We have 
some concerns about newer programs such as the ground system 
that accompanies GPS III. Of course, we have some concerns 
about some of the user equipment programs that are lagging 
behind schedule like FAB-T.
    On the other hand, we have seen some positive steps taken 
this year in programs like the Joint Space Operations Center 
mission system where they saw an acquisition strategy that was 
not maybe as executable and oversight-friendly as it could be, 
and they took steps to revamp the strategy and make it more 
executable.
    In general, today I would say there are very different 
conditions than we saw 10 years ago. The best practices are 
being adopted. There is more of an emphasis on evolutionary 
development for systems. There is more of an emphasis on 
developing technologies before beginning programs. There is 
definitely more emphasis on instituting higher quality 
standards for programs and following them. Then there has also 
been a number of actions to strengthen and streamline 
leadership across DOD.
    What we worry about today are some barriers to making all 
these things work together to the maximum extent possible, and 
the barriers that we worry about are much like what you talked 
about in your opening statement.
    First is the disconnects between ground equipment, 
particularly user equipment, and the satellites themselves. We 
are seeing too many programs that the user equipment is just 
arriving years later than the satellites. You really have a 
situation where you are wasting expensive capability in space 
when that happens.
    A second barrier is the rising cost of launch. There is no 
easy way to address this. In our report last year, what we 
stressed is the lack of good data on suppliers and costs. It 
just makes it more difficult to get your arms around the cost 
of launch and to reduce it.
    A third barrier that we talk about in our statement is S&T 
planning. As you mentioned, two key programs have been proposed 
for termination, including the space test program and the ORS 
program. When you look at those being terminated and combined 
with some planning weaknesses that we reported earlier this 
year, it raises cause for concern about the way forward for S&T 
in space and how do we expect to make technological 
advancements in the future. We do not see enough coordination 
between DOD agencies and other agencies involved in space in 
terms of strategic planning for space S&T.
    The last barrier fits in the bucket of coordination and 
leadership. It is exactly what you were talking about in your 
opening statement about programs all over Government. There is 
a lot of opportunity to optimize investments and work together 
better. Instead, we still see a lot of stovepiping in terms of 
programs being started and not enough looking at things from a 
Government-wide perspective and a very strategic perspective to 
see how investments in things like launch acquisitions, for 
example, could be maximized.
    With that, I will conclude my statement. Our written 
statement is much more detailed. Thank you.
    [The prepared statement of Ms. Chaplain follows:]
               Prepared Statement by Cristina T. Chaplain
    Chairman Nelson, Ranking Member Sessions, and members of the 
subcommittee: I am pleased to be here today to discuss the Department 
of Defense's (DOD) space acquisitions. Each year, billions of dollars 
are spent by DOD to acquire space-based capabilities that support 
military and other government operations--such as intelligence, 
reconnaissance and surveillance, and homeland security--and to enable 
transformation of the way DOD collects and disseminates information. 
The worst of DOD's space acquisition problems may be behind the 
department, as programs long plagued by serious cost and schedule 
overruns are finally being launched. Though acquisition challenges 
persist, they are not as widespread and significant as they were 
several years ago, and to its credit, DOD has taken an array of actions 
to reduce risks. The challenge DOD now faces is how best to keep its 
major space systems acquisitions on track in light of fiscal 
constraints. Operating in space is expensive and DOD is still in the 
process of replenishing legacy capabilities, such as missile warning, 
protected communications, and environmental monitoring. While upgrading 
existing satellite constellations amid declining budgets is a daunting 
challenge, there are significant barriers to ensuring investments are 
optimized, including fragmented leadership, the rising cost of launch, 
uncertainty about the future for technology advancements, and 
disconnects between the fielding of satellites with user equipment and 
ground systems needed to take advantage of expensive new capabilities. 
In addition to discussing the progress DOD has made this year, my 
testimony will focus on these challenges as they stand in the way of 
DOD fully realizing the benefits of satellite acquisition improvements.
    The objectives of this testimony are to address: (1) the current 
status of space system acquisitions; (2) the results of Government 
Accountability Office's (GAO) space-related reviews this past year; (3) 
actions being taken to address DOD space acquisition problems; and (4) 
remaining challenges. In preparing this testimony, we relied on 
previous GAO reports on: (1) space programs; and (2) weapon system 
acquisition best practices as well as ongoing work on satellite control 
networks.\1\ We also relied on work performed in support of our annual 
weapons system assessments, and analyzed DOD funding estimates to 
assess cost increases and investment trends for selected major space 
system acquisition programs. We obtained updates on improvement actions 
from the Office of the Secretary of Defense and Air Force. We also 
analyzed recent funding estimates for space programs. More information 
on our scope and methodology is available in the issued reports. The 
work that supports this statement was performed in accordance with 
generally accepted government auditing standards. Those standards 
require that we plan and perform the audit to obtain sufficient, 
appropriate evidence to provide a reasonable basis for our findings and 
conclusions based on our audit objectives. We believe that the evidence 
obtained provides a reasonable basis for our findings and conclusions 
based on our audit objectives.
---------------------------------------------------------------------------
    \1\ See GAO related reports at the end of this statement.
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                               background
    The past decade has been troubling for defense space acquisitions. 
Despite years of significant investment, most of the DOD large space 
acquisition programs collectively experienced billions of dollars in 
cost increases, stretched schedules, and increased technical risks. 
Significant schedule delays of as much as 9 years have resulted in 
potential capability gaps in missile warning, military communications, 
and weather monitoring. Unit costs for one of the most troubled 
programs, the Space Based Infrared System (SBIRS), for instance, have 
climbed about 231 percent to over $3 billion per satellite. Moreover, 
the first satellite was launched about 9 years later than predicted. 
Similarly, by the end of fiscal year 2010, the U.S. Government had 
spent 16 years and over $5 billion to develop the National Polar-
orbiting Operational Environmental Satellite System (NPOESS), but had 
not launched a single satellite. In February 2010, citing the program's 
cost overruns, schedule delays, and management problems, the White 
House announced that the NPOESS tri-agency structure would be 
eliminated and the program would be restructured by splitting 
procurements and responsibilities. Other programs, such as the 
Transformational Satellite Communications System, were canceled several 
years earlier because they were found to be too highly ambitious and 
not affordable at a time when the DOD was struggling to address 
critical acquisition problems elsewhere in the space portfolio.
            the current status of space system acquisitions
    In 2011, we testified that though problems still existed on many 
programs, DOD was beginning to make progress by finally launching 
satellites that had been lagging behind schedule.\2\ These included the 
Missile Defense Agency's (MDA) Space Tracking and Surveillance System, 
the Air Force's first Global Positioning System (GPS) IIF satellite and 
the first Advanced Extremely High Frequency (AEHF) satellite although 
AEHF had not yet reached its final planned orbit at the time we 
testified because of an anomaly with the satellite's propulsion system. 
At the same time, however, several programs still in development were 
at risk of cost and schedule growth, such as the Joint Space Operations 
Center Mission System (JMS).
---------------------------------------------------------------------------
    \2\ GAO, Space Acquisitions: DOD Delivering New Generations of 
Satellites, but Space System Acquisition Challenges Remain, GA0-11-590T 
(Washington, DC: May 11, 2011).
---------------------------------------------------------------------------
    Progress has continued since we testified last year. For instance:

         DOD launched the second GPS IIF satellite in July 
        2011, and the third is scheduled to launch in September 2012.
         DOD launched the first of the Navy's Mobile User 
        Objective System (MUOS) satellites in February 2012, and the 
        second is scheduled for launch in July 2013.
         The first of six SBIRS geosynchronous earth orbit 
        (GEO) satellites successfully launched in May 2011, after a 
        roughly 9 year delay.\3\ The second SBIRS satellite is planned 
        for delivery in spring 2012 and may launch late this year or 
        early 2013.
---------------------------------------------------------------------------
    \3\ Two highly elliptical orbit sensors have already been launched.
---------------------------------------------------------------------------
         The Evolved Expendable Launch Vehicle (EELV) program 
        continues to successfully launch DOD and National Aeronautics 
        and Space Administration (NASA) satellites, and is planning 11 
        launches in 2012.
         The first AEHF satellite reached its intended orbit 
        after having experienced propulsion trouble after launch. The 
        second AEHF satellite is scheduled to launch in April 2012.

    While these launches represent solid progress, there have been some 
drawbacks to the programs that have launched their first satellites. 
For instance, the second GPS IIF satellite experienced technical 
problems that could possibly shorten the satellite's operational 
lifetime. Also, though a MUOS satellite has been launched, the DOD 
estimates that over 90 percent of the first satellite's on-orbit 
capabilities will likely be initially underutilized because of delays 
in development of the compatible Joint Tactical Radio System (JTRS) 
terminals.
    Moreover, other acquisition programs are experiencing cost and 
schedule growth, though not to the extent yet as those experienced in 
the last decades. For instance:

         The GPS III program is currently experiencing cost 
        growth and the contractor is behind schedule. In November 2011, 
        the contractor's estimated cost at completion for the 
        development and production of the first two satellites was over 
        $1.4 billion or 18 percent greater than originally estimated; 
        the program office estimated the cost to be about $1.6 billion. 
        The GPS III program has cited multiple reasons for the 
        projected cost increases including reductions in the program's 
        production rate; test equipment delays; and inefficiencies in 
        the development of both the navigation and communication 
        payload and satellite bus. The contractor is also behind in 
        completing some tasks on schedule, but the program does not 
        expect these delays to affect the launch of the first 
        satellite.
         Though the first SBIRS satellite has launched, and the 
        second is close to delivery, program officials are predicting a 
        1-year delay on production of the 3rd and 4th GEO satellites 
        due in part to technical challenges, parts obsolescence and 
        test failures. Along with the production delay, program 
        officials are predicting a $438 million cost overrun for the 
        3rd and 4th GEO satellites.
         The Defense Weather Satellite System (DWSS), which was 
        the Air Force's follow-on to the restructured NPOESS, was 
        terminated in fiscal year 2012. The restructuring of NPOESS and 
        the subsequent cancellation of DWSS have resulted in a 
        potential capability gap for weather and environmental 
        monitoring.

    Table 1 describes the status of the space programs we have been 
tracking in more detail.
      
    
    
      
    
    
      
    
    
      
    
    
      
Acquisition Challenges Have Reverberating Effects on Investment 
        Portfolio
    Even though DOD has finally overcome some technical and production 
difficulties and begun to launch high risk satellites such as SBIRS and 
AEHF, the department is still contending with the effects of their 
significant cost growth on its investment portfolio. Figure 1 compares 
original cost estimates to current cost estimates for the broader 
portfolio of major space acquisitions for fiscal years 2011 through 
2016.
      
    
    
      
    A longstanding problem in DOD space acquisitions is that program 
and unit costs tend to go up significantly from initial cost estimates, 
and the gap between original and current estimates shows that DOD has 
fewer dollars available to invest in new programs or add to existing 
ones. In fact, estimated costs for the major space acquisition programs 
have increased by about $11.6 billion--321 percent--from initial 
estimates for fiscal years 2011 through 2016.\4\ It should also be 
noted that the declining investment in the later years is the result of 
mature programs that have planned lower out-year funding, cancellation 
of a major space acquisition program and several development efforts, 
and the exclusion of several major space acquisition efforts for which 
total cost data were unavailable. These include the Space Fence, Space 
Based Space Surveillance, and the Defense Weather Satellite effort.
---------------------------------------------------------------------------
    \4\ Costs adjusted for inflation.
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              gao space-related reviews over the past year
    Over the past year, we have reported on of the need for sound and 
sufficient information for the new DOD acquisition strategy for the 
EELV program; parts quality problems in major DOD, MDA, and NASA 
programs; and greater content and coordination in the space Science and 
Technology (S&T) strategy. We are also conducting a review of satellite 
operations and have briefed Defense authorization and appropriations 
committees on our findings. These reviews, discussed further below, 
highlight both the successes and challenges that have faced the DOD 
space community as it has completed or sought to complete problematic 
legacy efforts and deliver modernized capabilities.
Evolved Expendable Launch Vehicle Acquisition Strategy
    DOD's EELV program serves a vital mission of placing critical 
national security and civilian satellites into their required orbits. 
It is also on the brink of major changes. In 2009, the Air Force and 
the National Reconnaissance Office (NRO) determined that the current 
approach for acquiring EELV launch vehicles was likely not the best 
business model and decided that a new acquisition strategy needed to be 
developed. This strategy favors committing the government to a longer 
span of purchases and to more certainty in the number of vehicles 
acquired to help stabilize the industrial base. Such a change is 
significant as the DOD and the NRO plan to spend about $15 billion to 
acquire launch services from fiscal year 2013 to 2017 and commercial 
companies other than the current provider, United Launch Alliance, 
would like to become launch service providers to the government. We 
were asked to review and assess whether DOD has the knowledge it needs 
to develop the new trategy, which has subsequently been released, and 
to identify issues that could benefit future launch acquisitions.
    We found that DOD lacked critical knowledge needed to develop a new 
acquisition strategy.\5\ For example, program officials, recent launch 
studies, and the prime contractor all cited a diminishing launch 
industrial base as a risk to the mission success of the program, but 
DOD analysis supporting this condition was minimal. Moreover, under the 
new acquisition strategy, contracting officials may have difficulty 
assessing fair and reasonable prices given limited availability of 
contractor and subcontractor cost or pricing data. Since the United 
Launch Alliance joint venture formed in 2006, financial and business 
systems needed to get insight into costs have been lacking. There was 
also considerable uncertainty about costs associated with mission 
assurance activities, even though there have been concerns about 
whether such activities are excessive. Moreover, we found that if the 
acquisition strategy commits the Air Force and the NRO to buy eight 
common booster cores per year for a 5 year period, which was 
anticipated at the time of our review, DOD may face an oversupply of 
vehicles. In addition to these findings, we have reported prior 
concerns about oversight for the EELV program, such as: (1) a prior 
decision to designate the program as in the sustainment phase rather 
than in the development phase essentially lifted the need for oversight 
reporting on costs and major changes; and (2) the DOD had not updated a 
life cycle cost estimate for the program despite significant changes 
being made to it.\6\
---------------------------------------------------------------------------
    \5\ GAO, Evolved Expendable Launch Vehicle: DOD Needs to Ensure New 
Acquisition Strategy Is Based on Sufficient Information, GA0-11-641 
(Washington, DC: Sep. 15, 2011).
    \6\ GAO, Space Acquisitions: Uncertainties in the Evolved 
Expendable Launch Vehicle Program Pose Management and Oversight 
Challenges, GA0-08-1039 (Washington, DC: Sep. 26, 2008).
---------------------------------------------------------------------------
    Among other actions, we recommended that DOD conduct an independent 
assessment of the health of the U.S. launch industrial base; reassess 
the block buy contract length given the additional knowledge DOD is 
gaining; not waive Federal Acquisition Regulations requirements for 
contractor and subcontractor certified cost and pricing data as DOD 
finalizes its strategy; and ensure launch mission assurance activities 
be sufficient and not excessive. Congress reinforced these and other 
GAO recommendations in the National Defense Authorization Act of 2012 
by requiring that DOD redesignate the program as a major defense 
acquisition program (which would require the submission of certain 
kinds of data annually) and provide to Congressional defense committees 
a description of how its acquisition strategy will address the 
recommendations of our EELV report issued in 2011.\7\ The Act also 
requires us to submit an assessment of the information DOD provides, 
and additional findings or recommendations, as appropriate. The Air 
Force has taken actions to expand its knowledge about EELV since our 
2011 audit work was completed and we look forward to assessing this 
progress.
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    \7\ Pub. L. No. 112-81, Sec. Sec. 838 & 839 (2011).
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Parts Quality for DOD, MDA, and NASA
    Quality is paramount to the success of U.S. space and missile 
defense programs due to their complexity, the environment they operate 
in, and the high degree of accuracy and precision needed for their 
operations. Yet in recent years, many programs have experienced 
difficulties with quality workmanship and parts. Less visible problems 
have led to unnecessary repair, scrap, rework, and stoppage; long 
delays; and millions of dollars in cost growth. In some instances, 
entire missions have been endangered. As a result, we assessed the 
extent to which such problems affect related programs, their causes, 
and what initiatives have been undertaken in response.
    We found that parts quality problems had affected all 21 programs 
we reviewed, in some cases contributing to significant cost overruns 
and schedule delays associated with electronic versus mechanical parts 
or materials.\8\ We also found that if quality problems were discovered 
late in the development cycle they had more significant cost and 
schedule consequences: in one such case, an additional cost of at least 
$250 million and a 2-year launch delay. We found several causes of 
these problems: poor workmanship, undocumented and untested 
manufacturing processes, poor control of those processes and materials 
and failure to prevent contamination, poor part design, design 
complexity, and an inattention to manufacturing risks. Ineffective 
supplier management also resulted in concerns about whether 
subcontractors and contractors met program requirements.
---------------------------------------------------------------------------
    \8\ GAO, Space and Missile Defense Acquisitions: Periodic 
Assessment Needed to Correct Parts Quality Problems in Major Programs, 
GA0-11-404 (Washington, DC: June 24, 2011).
---------------------------------------------------------------------------
    Recognition of these difficulties has spurred agencies to adopt new 
policies, but they were still in early stages of implementation at the 
time of our review. Post-policy programs are not yet mature enough for 
parts problems to be apparent. To address current and future problems, 
agencies and industry have begun to collect and share information, 
develop testing guidance and criteria, manage subcontractors, and 
mitigate problems, although their impact has yet to be determined. In 
any event, significant barriers hinder such efforts, including broader 
acquisition management problems, workforce gaps, diffuse leadership in 
the national security space community, the government's decreasing 
influence on the electronics parts market, and an increase in 
counterfeited parts. Our reports over the past decade have made 
recommendations for addressing these broader barriers, such as 
stabilizing requirements before beginning product development, 
separating technology development from product development, and 
strengthening leadership. The DOD is in the process of adopting these 
recommendations. Because space agencies and the Missile Defense Agency 
were undertaking additional actions to address parts quality problems 
and they had recently established a broad range of coordination 
mechanisms, we recommended that the community undertake periodic 
assessments of progress being made to address parts quality problems. 
The agencies generally agreed with our recommendation.
Space S&T Strategy
    The National Defense Authorization Act for Fiscal Year 2010 
required DOD and the Director of National Intelligence (DNI) to jointly 
develop a space S&T strategy and it required us to assess the strategy 
submitted in April 2011.\9\ We reported that a strong foundation in 
space S&T should help DOD and the intelligence community address the 
most challenging national security problems, reduce risk in major 
acquisition programs, maintain technological superiority over 
adversaries, maintain a healthy industrial base and mitigate 
vulnerabilities in space systems.\10\
---------------------------------------------------------------------------
    \9\ Pub. L. No. 111-84, Sec. 911(b) (2009).
    \10\ GAO, Space Research: Content and Coordination of Space Science 
and Technology Strategy Need to Be More Robust, GA0-11-722 (Washington, 
DC: July 19, 2011).
---------------------------------------------------------------------------
    We found that the strategy largely met the requirements of the 
authorization act, but it was not a rigorous, comprehensive strategic 
plan. Instead, it embraced the status quo without laying out a path for 
assuring effective and efficient progress. For instance, the strategy 
identified goals, but did not prioritize them. The strategy described 
existing reviews used to assess progress in space S&T but did not 
identify new metrics or performance measures to be used to assess 
achievement of the strategy's newly established goals. Nor did the 
strategy address fundamental challenges facing the S&T community, such 
as human capital shortages, growing fiscal pressures, and the 
difficulty in transitioning space S&T to acquisition programs. We 
identified some strategic planning best practices such as identifying 
required human capital and required funding; prioritizing initiatives; 
and establishing ways to measure progress and processes for revising 
goals in the future. Additionally, we found that organizations involved 
in developing the strategy were active in creating its long- and short-
term goals, but their participation in other of its aspects was more 
limited. DOD and DNI officials did not believe they were required to do 
more than they did, and also did not include other agencies active in 
space S&T that were not included by law in the strategy. We recommended 
that DOD enhance its next version of the strategy by developing a 
detailed implementation plan for achieving goals, addressing funding 
prioritization and other challenges, and enhancing coordination with 
other agencies involved in space technology development. DOD concurred 
with these recommendations.
DOD Satellite Operations
    The Air Force and Navy operate separate satellite control networks 
within DOD through multiple operations centers, enabling their 
satellites to perform missions from launch to on-orbit operations and 
eventually through deactivation. Other Federal Government agencies, 
such as the NASA and the National Oceanic and Atmospheric 
Administration (NOAA), and commercial companies also operate satellites 
using various networks and operations centers. Combined, these networks 
assist the Nation's communications, missile warning, navigation, 
meteorological, environmental, and scientific satellites or missions.
    DOD has efforts underway to modernize various satellite operations 
centers using proprietary and interoperable network architectures using 
standard protocols. For example, since 2006, the Air Force has operated 
a multi-mission operations center that uses a standard interface and 
telemetry, tracking, and commanding system which allows expedited 
transition of research satellites to operational satellites. In 
addition, in 2000, the Naval Research Laboratory initiated a web-based 
service concept designed to optimize software code reuse and allow 
faster delivery of mission capabilities, which could lower mission 
development costs and facilitate system maintenance. Considering the 
longstanding need to replace the Air Force's aging and costly satellite 
control capabilities, and the importance associated with satellite 
operations, it is important that DOD not miss an opportunity to improve 
satellite operations and create greater efficiencies by leveraging 
commercial practices and other satellite networks and associated 
infrastructure.
    In ongoing work, we assessed DOD's satellite operations 
capabilities, specifically modernization efforts, compare DOD satellite 
operations concepts with those in other government entities and 
commercial industry; and, identify practices that could improve DOD 
satellite operations, consistent with mission requirements. We 
identified several challenges associated with DOD's modernization 
efforts. For example, DOD's ability to plan and implement upgrades may 
be limited by current budget uncertainties and plans to reallocate a 
portion of DOD's spectrum may affect its satellite operations. In 
addition, we found indications that the potential for unnecessary 
overlap and fragmentation still exists within satellite operations and 
associated infrastructure, including potential duplication of 
facilities and hardware. For instance, there are multiple, completely 
separate government satellite control networks that exist that depend 
on DOD's Air Force satellite control network, including military and 
civil networks, but none are interoperable. Finally, we have thus far 
found that although research and development in government satellite 
operations has led to the use of practices that, according to agency 
officials, have improved efficiency, there are other commercial 
practices that could provide further improvements to DOD's satellite 
network. For example, increased automation of routine satellite 
telemetry, tracking, and commanding functions could increase satellite 
operations efficiencies. We expect to issue our report based on this 
review later this fall.
       actions being taken to address space acquisition problems
    Though our reports over the year indicate there is more room for 
improvement, DOD continues to work to ensure that its space programs 
are more executable and produce a better return on investment. Many of 
the actions it has been taking are intended to address root causes of 
problems, though it will take time to determine whether these actions 
are successful and they need to be complemented by decisions on how 
best to lead, organize, and support space activities.
    Causes of Acquisition Problems
    Our past work has identified a number of causes of acquisition 
problems, but several consistently stand out. At a higher level, DOD 
has tended to start more weapon programs than is affordable, creating a 
competition for funding that focuses on advocacy at the expense of 
realism and sound management. DOD has also tended to start its space 
programs before it has the assurance that the capabilities it is 
pursuing can be achieved within available resources and time 
constraints. There is no way to accurately estimate how long it would 
take to design, develop, and build a satellite system when critical 
technologies planned for that system are still in relatively early 
stages of discovery and invention. Finally, programs have historically 
attempted to satisfy all requirements in a single step, regardless of 
the design challenges or the maturity of the technologies necessary to 
achieve the full capability. DOD's preference to make larger, complex 
satellites that perform a multitude of missions has stretched 
technology challenges beyond current capabilities in some cases. Figure 
6 illustrates the negative influences that can cause programs to fail.
      
    
    
      
    Our work has recommended numerous actions that can be taken to 
address the problems we identified. Generally, we have recommended that 
DOD separate technology discovery from acquisition, follow an 
incremental path toward meeting user needs, match resources and 
requirements at program start, and use quantifiable data and 
demonstrable knowledge to make decisions to move to next phases. We 
have also identified practices related to cost estimating, program 
manager tenure, quality assurance, technology transition, and an array 
of other aspects of acquisition program management that could benefit 
space programs.\11\ DOD has generally concurred with our 
recommendations, and, as described below, has undertaken an array of 
actions to establish a better foundation for acquisition success.
---------------------------------------------------------------------------
    \11\ GAO, Space Acquisitions: DOD Poised to Enhance Space 
Capabilities but, Persistent Challenges Remain in Developing Space 
Systems, GA0-10-447T (Washington, DC: March 10, 2010).
---------------------------------------------------------------------------
Actions to Improve Space and Weapon Systems Acquisitions
    As we reported last year, DOD has implemented or has been 
implementing a number of actions to reform how space and weapon systems 
are acquired, both through its own initiatives as well as those 
required by statute. Among other actions, DOD intends to follow 
incremental or evolutionary acquisition processes for space programs 
versus pursuing significant leaps in capabilities involving technology 
risk, and has done so with the only new satellite program undertaken by 
the Air Force in recent years--GPS III and more recently with Joint 
Space Operations Center Mission System, which supports space 
situational awareness activities. DOD and the Air Force are also 
working to streamline management and oversight of the national security 
space enterprise. For example, all Air Force space system acquisition 
responsibility has been assigned to the office responsible for all 
other Air Force acquisition efforts, and options for streamlining the 
many space committees, boards, and councils is under ongoing review. 
These and other actions being taken that could improve space system 
acquisition outcomes, that we have not assessed, are described in table 
2.
      
    
    
      
    
    
    
    
      
    Congress and DOD have taken major steps toward reforming the 
defense acquisition system in ways that may increase the likelihood 
that weapon programs will succeed in meeting planned cost and schedule 
objectives.\12\ In particular, DOD policy and legislative provisions 
place greater emphasis on front-end planning and establishing sound 
business cases for starting programs. For example, the provisions 
require programs to invest more time and resources to refine concepts 
through early systems engineering, strengthening cost estimating, 
developing technologies, building prototypes, holding early milestone 
reviews, and developing preliminary designs before starting system 
development.\13\ These provisions are intended to enable programs to 
refine a weapon system concept and make cost, schedule, and performance 
trade-offs before significant commitments are made. In addition, DOD 
policy requires establishment of configuration steering boards that 
meet annually to review program requirements changes as well as to make 
recommendations on proposed descoping options that could reduce program 
costs or moderate requirements. Fundamentally, these provisions should 
help: (1) programs replace risk with knowledge; and (2) set up more 
executable programs.
---------------------------------------------------------------------------
    \12\ GAO, Defense Acquisitions: Strong Leadership Is Key to 
Planning and Executing Stable Weapon Programs, GA0-10-522 (Washington, 
DC: May 6, 2010).
    \13\ Weapon Systems Acquisition Reform Act of 2009 (WSARA), Pub. L. 
No. 111-23; DOD Instruction 5000.02, Operation of the Defense 
Acquisition System (2008).
---------------------------------------------------------------------------
    While DOD has taken steps to implement the provisions, it is too 
soon to determine if Congress's and DOD's reform efforts will improve 
weapon program outcomes. For example, in June 2011 we reported on the 
Joint Requirements Oversight Council's (JROC) efforts to ensure trade-
offs among cost, schedule, and performance objectives, as directed by 
the Weapon Systems Acquisition Reform Act.\14\ We found that the JROC 
did not always consider tradeoffs or influence tradeoff decisions, 
military services did not consistently provide high quality resource 
estimates to the JROC, and JROC did not consistently prioritize 
requirements and capability gaps. We recommended that the JROC 
establish a mechanism to review analysis of alternatives results 
earlier in the acquisition process, require higher quality resource 
estimates from requirements sponsors, prioritize requirements across 
proposed programs, and address potential redundancies during 
requirements reviews. The Joint Staff partially concurred with our 
recommendations and generally agreed with their intent, but differed 
with us on how to implement them.
---------------------------------------------------------------------------
    \14\ GAO, DOD Weapons Systems: Missed Trade-off Opportunities 
During Requirements Reviews, GA0-11-502 (Washington, DC: June 16, 
2011).
---------------------------------------------------------------------------
                          remaining challenges
    The actions that the Office of the Secretary of Defense and the Air 
Force have been taking to address acquisition problems are good steps. 
But there are still significant barriers to ensuring investments are 
optimized, including fragmented leadership, the high cost of launch, 
uncertainty about the future for technology advancements, and 
disconnects between the fielding of satellites with user equipment and 
ground systems needed to take advantage of expensive new capabilities. 
In particular:

         Leadership. In past years, we have reported that a 
        major challenge to leadership is that the community's 
        authorities and responsibilities are spread across the 
        department, and there is no single authority responsible for 
        these programs below the President. Both the DOD and Air Force 
        have taken a number of steps to streamline and clarify 
        leadership for space. Time will tell whether these steps will 
        help resolve issues such as a difficulty holding any one person 
        or organization accountable for balancing needs against wants, 
        for resolving conflicts among the many organizations involved 
        with space, and for ensuring that resources are dedicated where 
        they need to be dedicated. The department is still struggling 
        with disconnects between programs that need to be linked 
        together, such as a satellite program and its user equipment 
        program. At a higher level, we have reported that it still 
        appears as if agencies involved in space acquisitions do not 
        coordinate to the extent that they can in such areas as launch 
        acquisitions and space S&T planning.\15\
---------------------------------------------------------------------------
    \15\ GAO, 2012 Annual Report: Opportunities to Reduce Duplication, 
Overlap and Fragmentation, Achieve Savings, and Enhance Revenue, GA0-
12-342SP (Washington, DC: Feb.28, 2012).
---------------------------------------------------------------------------
         Launch costs. A factor influencing how space programs 
        are designed is the price of launch, which can range anywhere 
        from around $100 million to well over $200 million. With prices 
        being so high, programs often seek to maximize the ``real 
        estate'' on board a satellite by including more capabilities 
        than can sometimes be handled by a single program or within the 
        time period desired for the program. Moreover, the Air Force 
        recently developed a new launch acquisition strategy designed 
        in part to contain launch prices, but given remaining knowledge 
        gaps, achieving this outcome is uncertain. At the same time, 
        potential new providers promise lower costs for launch, but 
        none of them have been certified to launch the larger national 
        security satellites, and it is uncertain whether their prices 
        can stay low as they work to meet standards and expectations 
        set by government agencies. The dilemma of high launch costs, 
        in our view, makes it more important for the Air Force to gain 
        insight into costs and pricing behind its new strategy and to 
        have a complete understanding of the industrial base and 
        related vulnerabilities as well as mission assurance activities 
        and related costs. It would also behoove agencies to work 
        together, not only to bring in new entrants which they are now 
        doing, but in setting a future course for launch. S&T planning, 
        for example, has been cited as a weak area for launch, even 
        though investments in new propulsion and vehicle concepts have 
        the potential to evolve capabilities and lower costs.
         S&T and related investments. Recent proposed funding 
        cuts have raised questions about how future technology 
        advancements will be achieved in space. The Space Test Program 
        (STP) was targeted for termination in the fiscal year 2013 
        budget. STP was created in 1965 to serve as an integrator to 
        provide launch opportunities for experimental satellites. This 
        program enabled new technologies to get on orbit, and pave the 
        way in an affordable manner for new space capabilities. STP has 
        spawned many current and valuable space programs, most notably 
        GPS. With the cancelation of this program, the Secretary of the 
        Air Force has stated that the organizations that develop these 
        new space technologies, including academic institutions, 
        government laboratories, and others, will be required to 
        shoulder the burden of launch costs, estimated at around $50 
        million per year. DOD has also proposed cancellation of the 
        Operationally Responsive Space (ORS) program. ORS was intended 
        to provide short-term and low-cost tactical capabilities to 
        warfighters. The ORS program's long-term goals were to reduce 
        the cost of space development by fostering low cost launch 
        methods as well as common design and interface methods. Average 
        spending by the ORS program was about $100 million per year 
        from fiscal years 2007 through 2011. While there are still 
        investments available for the Air Force Research Laboratory and 
        other organizations involved in S&T, as we mentioned earlier, 
        planning for these investments has not been robust or very 
        strategic. Another potential challenge to future space 
        capability innovations is the Efficient Space Procurement (ESP) 
        initiative, formerly known as the Evolutionary Acquisition for 
        Space Efficiency (EASE). ESP is intended as a way to reduce 
        costs for DOD space programs while improving acquisition 
        outcomes by buying satellites in ``block buys'' instead of 
        individually, accruing cost savings which are to be reinvested 
        into a modernization program to evolve capabilities for future 
        increments of that satellite program. At this time, it is 
        unclear how this approach will ensure there will still be a 
        focus on making significant leaps in technology or what the 
        next generation of space systems will look like and be able to 
        come into fruition.
         Disconnects between fielding satellites, ground 
        systems, and user equipment. DOD faces challenges in 
        synchronizing capabilities offered by new satellite programs 
        with the ground control stations that are necessary for 
        receiving and processing information from the new space 
        systems, and in some cases, the user terminals that deliver 
        this information to users.\16\ When space, ground and user 
        segments are not synchronized, there is the potential for 
        wasted on-orbit capability and delays in the ability of users 
        to take advantage of new systems. As long as this condition 
        exists, the improvements being made to acquisition practices on 
        the satellite side will be minimized. A few examples are 
        highlighted below in table 3.
---------------------------------------------------------------------------
    \16\ GAO, Defense Acquisitions: Challenges in Aligning Space System 
Components, GA0-10-55 (Washington, DC: Oct. 29, 2009).
---------------------------------------------------------------------------
      
    
    
      
                           concluding remarks
    After more than a decade of serious acquisition difficulties, DOD 
is starting to launch new generations of satellites that promise vast 
enhancements in capability. Moreover, given the Nation's fiscal 
challenges, DOD's focus on streamlining leadership, fixing problems, 
and implementing reforms is promising. But there are still significant 
barriers to achieve acquisition success that need to be addressed to 
maintain space superiority in an era of fiscal austerity. All of the 
barriers-leadership fragmentation, launch costs, S&T planning, and 
disconnects between space and ground assets-require action from the Air 
Force and the Office of the Secretary of Defense as well as the 
participation and cooperation of all the military services, the 
intelligence community, and other agencies such as NASA and NOAA. 
Moreover, though successful launches are being experienced, problems 
within ongoing development efforts such as GPS III, indicate that space 
acquisitions are still at risk of significant cost and schedule 
problems, and attention to reforms must be sustained.
    Chairman Nelson, Ranking Member Sessions, this completes my 
prepared statement. I would be happy to respond to any questions you 
and members of the subcommittee may have at this time.
                      contacts and acknowledgments
    For further information about this statement, please contact 
Cristina Chaplain at (202) 512-4841 or [email protected] Contact 
points for our Offices of Congressional Relations and Public Affairs 
may be found on the last page of this statement. Individuals who made 
key contributions to this statement include Art Gallegos, Assistant 
Director; Maricela Cherveny; Laura Hook; Angela Pleasants; Roxanna Sun; 
Bob Swierczek; and Alyssa Weir.
                          related gao products
    2012 Annual Report: Opportunities to Reduce Duplication, Overlap 
and Fragmentation, Achieve Savings, and Enhance Revenue, GA0-12-342SP 
(Washington, DC: February 28, 2012).
    Evolved Expendable Launch Vehicle: DOD Needs to Ensure New 
Acquisition Strategy Is Based on Sufficient Information, GA0-11-641 
(Washington, DC: September 15, 2011 ).
    Space Research: Content and Coordination of Space Science and 
Technology Strategy Need to Be More Robust, GA0-11-722 (Washington, DC: 
July 19, 2011).
    Space and Missile Defense Acquisitions: Periodic Assessment Needed 
to Correct Parts Quality Problems in Major Programs, GA0-11-404 
(Washington, DC: June 24, 2011).
    DOD Weapons Systems: Missed Trade-off Opportunities During 
Requirements Reviews, GA0-11-502 (Washington, DC: June 16, 2011).
    Space Acquisitions: DOD Delivering New Generations of Satellites, 
but Space System Acquisition Challenges Remain, GA0-11-590T 
(Washington, DC: May 11, 2011).
    Defense Acquisitions: Challenges in Aligning Space System 
Components, GA0-10-55 (Washington, DC: October 29, 2009).
    Global Positioning System: Challenges in Sustaining and Upgrading 
Capabilities Persist. GA0-10-636. (Washington, DC: September 15, 2010).
    Polar-Orbiting Environmental Satellites: Agencies Must Act Quickly 
to Address Risks That Jeopardize the Continuity of Weather and Climate 
Data. GA0-10-558. (Washington, DC: May 27, 2010).
    Defense Acquisitions: Strong Leadership Is Key to Planning and 
Executing Stable Weapon Programs, GA0-10-522 (Washington, DC: May 6, 
2010).
    Space Acquisitions: DOD Poised to Enhance Space Capabilities but, 
Persistent Challenges Remain in Developing Space Systems, GA0-10-447T 
(Washington, DC: March 10, 2010).
    Space Acquisitions: Government and Industry Partners Face 
Substantial Challenges in Developing New DOD Space Systems. GA0-09-
648T. (Washington, DC: April 30, 2009).
    Space Acquisitions: Uncertainties in the Evolved Expendable Launch 
Vehicle Program Pose Management and Oversight Challenges. GA0-08-1 039. 
(Washington, DC: September 26, 2008).
    Defense Space Activities: National Security Space Strategy Needed 
to Guide Future DOD Space Efforts. GA0-08-431 R. (Washington, DC: March 
27, 2008).
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U.S. Government Accountability Office, 441 G Street NW, Room 7149, 
Washington, DC 20548

    Senator Nelson. Shall we begin with about 6-minute 
questions?
    Senator Sessions. Fine.
    Senator Nelson. Secretary Creedon, as we indicated--and in 
your testimony you made some reference to it as well--the 
administration is working to develop some multilateral 
understanding, starting with Europe, on how to conduct space 
operations, given the congestion in space, that we have to do 
something.
    From DOD's view, are you satisfied that the current track 
does not hinder military operations in space?
    Ms. Creedon. Senator, DOD and DOS in February announced 
that they were going to work together and seek a code of 
conduct. The code of conduct is an opportunity, we think, to 
get all the space-faring nations together and look at how to 
address shared concerns, debris mitigation, radio frequency 
interference, joint situational awareness, and work together in 
a way that benefits our national security interest.
    We have just begun this journey. In fact, the very first 
meeting of experts will be in June, and from then on, we will 
go down this path and work on getting an agreement that really 
is in our best interest, set norms for responsible behavior, 
and in some period of time, hopefully, get a conduct that is in 
our national security interest.
    This is not going to be a quick process. It is probably 
going to be at least a year, maybe 2. We think it is worth it 
in the long run to go down this road and try and obtain a 
voluntary agreement. It is not legally binding and it will not 
limit our ability to either develop systems or to defend 
ourselves.
    Senator Nelson. Could you give us an idea, let us say, of 
just one aspect of the code of conduct that you would be 
working on?
    Ms. Creedon. One of the most important is probably debris 
mitigation. One of the elements that we would expect to be in a 
final code of conduct would be setting norms for debris 
mitigation. It would establish the requirement that as 
countries launch satellites, as they do any sort of 
experimentation, that they minimize the amount of debris 
created. This was very important as we all discovered when the 
Chinese conducted their ASAT test and made a substantial amount 
of debris. Debris creation hurts everybody, and this is 
probably one of the main focuses of this agreement.
    Senator Nelson. So there would be some sort of protocol for 
disintegration of out-of-date, out-of-service units within 
space. Is that one of the things that would be included? Is 
that how you would say that?
    Ms. Creedon. That would be one of the norms that a country 
makes sure that a satellite that has died does not stay in 
orbit. One of it would be as you launch satellites, that you 
minimize the amount of debris that is created. Even a 
coordinated space situational awareness would help because then 
it would allow advanced opportunities to maneuver satellites so 
you did not have collisions like the Iridium satellite that 
occurred several years ago that collided with the Russian space 
satellite.
    Senator Nelson. Moving on the spectrum issue, Madam 
Secretary, in February DOD almost lost a block of spectrum 
through a legislated auction to pay for a tax offset. Can you 
explain the importance of DOD spectrum in general and how any 
movement from it should be paid for and coordinated?
    Ms. Creedon. Yes, sir. Spectrum is essential to almost 
everything that DOD does, ISR, communications, command, and 
control, navigation. It goes on and on and on. DOD needs 
spectrum to function. Making sure that spectrum is available is 
absolutely essential. As we look at supporting the efforts to 
utilize spectrum more efficiently if DOD is going to move out 
of different areas of spectrum, it is going to take a while to 
understand exactly what other areas are available. Are these 
other areas technically compatible with requirements? What is 
the cost to move, and what is the timeframe to move? In some 
instances, there might be some systems that would never be able 
to move. In any sort of an auction, they would have to be 
allowed to stay.
    Senator Nelson. In any event, we have it under control 
where this is not going to happen again, as far as we know.
    Ms. Creedon. We certainly hope not. DOD is also right now 
looking at a long-term strategy for spectrum allocation that 
should help in terms of both understanding the requirements and 
understanding where we can move.
    Senator Nelson. In your statement, you stress the 
importance of resiliency and the ability to rapidly 
reconstitute critical satellite capacity if hostile action or a 
collision would occur. It sounds like you might want me to tee 
up a question here on why this is so important. Did DOD propose 
in the fiscal year 2013 budget to cancel the ORS program? If 
so, do you agree with that decision?
    Ms. Creedon. DOD did propose to cancel the office. On the 
other hand, DOD does recognize the successes of the office, 
both the ORS-1 SAT and the TacSat-3, and it is those successes 
that have enabled DOD to say now is the time to take the idea 
of ORS, normalize it across all programs, and then move the 
capability to the Air Force primarily, to have the Air Force 
then work with all the Services to make sure that all space 
programs have this notion of resiliency and redundancy built 
into them.
    Senator Nelson. Being able to bounce back from some sort of 
a lights-out situation is critically important. Do you think 
that we have it adequately handled right now?
    Ms. Creedon. Not yet, but it is certainly something that is 
on the radar, if you will, and it is certainly something that 
DOD is working very hard to accomplish. I might, at some point, 
turn over the answer to General Shelton as the programmatic 
person to really address more of the specifics of how the 
satellites themselves are looking more at how to build in this 
concept of resiliency and redundancy into future space 
programs.
    Senator Nelson. Even though my time has expired, General 
Shelton, anything you would like to add to that?
    General Shelton. Mr. Chairman, I would completely agree on 
spreading the ORS concepts across all of our programs. In fact, 
a lot of the activities at Kirtland Air Force Base that 
occurred with a dedicated office will continue because there 
were organizations in place that supported the ORS office 
there. There are also offices at the Space and Missile Systems 
Center in Los Angeles that will continue to provide that kind 
of support. So I am confident that that concept will continue.
    As far as resiliency across all of our programs, we just 
completed all this research and development (R&D) work, and we 
are in the production phase of many of our foundational 
capabilities. However, we are looking at alternative 
architectures for the future, and I believe those alternative 
architectures will produce some of the resilience that we would 
like to have. The question is when can you afford to implement 
those, and that will be a hard decision we will face in the 
coming years.
    Senator Nelson. Thank you.
    Senator Sessions.
    Senator Sessions. Thank you very much.
    General Shelton, with regard to ORS and the need, as 
Secretary Creedon mentioned, for resiliency, for the record is 
it not true that currently we do not plan to have any 
satellites in reserve that could be immediately launched if one 
of our satellites is disabled for some reason?
    General Shelton. Senator, that is true. We do not build 
satellites as spares and store them on the ground. If we have 
capability that is in storage, it is because we have had good 
fortune in a satellite lasting longer or we did not have the 
launch ready at the time we had the satellite ready, by and 
large.
    Senator Sessions. I guess my question--I am not sure what 
we thought as ORS development. But one of the things that we 
understood was that we would be able to launch a capable, maybe 
not highly sophisticated, satellite that would meet our basic 
needs in pretty short order if one were disabled, recognizing 
that there are quite a number of countries, would you not 
agree, that have the capability to disable a U.S. satellite?
    General Shelton. Senator, there are quite a few.
    Senator Sessions. More will probably come along in the 
future. Was that originally part of the idea, to your 
knowledge?
    General Shelton. It was part of the concept that we would 
develop rapid launch capability, rapid assembly of satellite 
capability. But the idea that we would have a stock, a storage 
of satellites and boosters waiting--that decision had not been 
made. So there was conceptual work to be done as part of ORS, 
but no decision on how to actually develop a concept of 
operations to take advantage of what might have been developed.
    Senator Sessions. I think it is a matter worthy of thinking 
about whether we need that capability. I do not know. You may 
could use every satellite that you have, and you might as well 
put them in space would be one argument. But also, if there was 
a danger of a satellite that just failed for one reason or 
another in a critical area, we might need immediate response.
    General Formica, the Space and Missile Defense Command is 
an important part of our defense system. first, thank you for 
your leadership, and second, how do you see your budget this 
year? The Air Force space budget is pretty substantially 
reduced. What about SMD?
    General Formica. Mr. Senator, thank you. I appreciate it. 
It is an honor to serve at Space and Missile Defense Command.
    Our budget in fiscal year 2013 right now is holding its 
own, about the same as we had in fiscal year 2012. We have 
sufficient budget to be able to provide our operational 
capability, to do capability development, and to do the 
material development functions that we have. If funded, we will 
benefit from the JCD program which will be funding not directly 
given to Space and Missile Defense Command/Army Forces 
Strategic Command (SMDC/ARSTRAT).
    Senator Sessions. The GAO representative mentioned 
terminated programs and sort of asked the question how do we 
advance without S&T. Some of the S&T programs have been 
reduced. Maybe, General Shelton, General Formica, do you have 
any comment about that? Does that concern you?
    General Shelton. Senator, it does.
    Senator Sessions. First, let me just say that I know that 
you support the budget request that you have been given. You 
have had a chance to review it. But I know that it was clear to 
both of you that there is a limited amount of money. So I am 
asking you do you have concerns or are their worries to tell us 
honestly what they might be with regard to S&T because what the 
experts tell us--experts or the old hands or whatever you call 
them--when budgets get cut, S&T is one of he first casualties, 
and we do not want to go too far in that regard. So would you 
give us your best judgment about what kind of risk we may be 
taking there?
    General Shelton. Yes, sir. First, a couple of statistics. 
The S&T budget space-related for Air Force Research Laboratory 
(AFRL) is going to be $242 million in fiscal year 2013. The 
budget for Defense Advanced Research Projects Agency (DARPA) 
for space-related S&T, roughly $160 million. In the Navy, 
roughly $27 million. In the Army, roughly $22 million. There is 
still substantial space-related S&T despite the cancelation of 
the space test program.
    Senator Sessions. All right. How much would you say it has 
been reduced? You mentioned those numbers, but is that a 
reduction from current expenditures, any of those accounts?
    General Shelton. We had roughly $50 million in the space 
test program in fiscal year 2012. We have $10 million in fiscal 
year 2013 remaining, largely to conduct the launch of Space 
Test Program-2 (STP-2) as one of our new entrants into the EELV 
program. So it is not totally decimated, but by the same token, 
to be honest with you, that $10 million is really only for that 
launch.
    Senator Sessions. So you do not have more for other 
launches that might occur. But the space test you mentioned--is 
that included in your $240 million?
    General Shelton. It is all space-related S&T.
    Now, how we develop the priorities for that is important. 
We meet every year with AFRL, my leadership, AFRL's leadership. 
We establish 174 technology needs across the entire enterprise. 
We do the same thing with DARPA, establish priorities that we 
want them to work on. So we get a voice in how that money is 
spent. It is not the same as having the space test program 
directly under me, but we certainly have a voice.
    Senator Sessions. Would you say that we may be cutting it 
close here, or are you just perfectly happy with where we are?
    General Shelton. Senator, I wish we could spend more money 
on it. I truly do. But again, the BCA called for reductions. 
That is one of the places where we felt like we could take 
reductions.
    Senator Sessions. I understand the choices you make. Every 
defense agency, every congressional group that sits, and every 
President has a responsibility to the future, as well as to the 
immediate DOD. If we do not spend our money now to perhaps 
develop the systems that are serving us so well now for the 
future, then we fail too. So I hope that you will be candid 
with us if you see threats in that area of our budget.
    I guess I could ask the Navy and the Army too. Maybe GAO. 
Ms. Chaplain, do you have any comment on that? You expressed 
some concern about it.
    Ms. Chaplain. Yes. I have a couple of comments. I do 
acknowledge that there is still funding going to some of these 
labs, and it is a good amount of funding. But what we have not 
seen is very robust strategic planning about what are our goals 
for technology advances and how are we going to achieve them 
and how are we going to optimize these investments because they 
will probably have more budget pressure over time.
    The thing with the space test program I would like to 
emphasize is that it provided an avenue for different kinds of 
players to test technologies, universities, small businesses, 
those who do not really get to be able to participate in some 
of these bigger programs all the time. So you might be losing 
that opportunity.
    Then the third thing is that DOD would like to go on a 
multiyear approach to some of its bigger programs, like AEHF 
and SBIRS-High. There is an assertion there that whatever 
savings are gained from that will be reinvested in S&T, but we 
have not really seen a robust plan there for the path forward. 
Where do we go after programs like AEHF and SBIRS? We have not 
seen that path yet and how are we going to get there because 
you have to start now especially given the budget situation.
    Senator Sessions. I think that is a good challenge. I think 
we do need a good plan.
    Thank you, Mr. Chairman. My time is up.
    Senator Nelson. Thank you, Senator Sessions.
    Secretary Creedon, does DOD have in place a policy for 
coordination of space activities within the interagency 
structure?
    Ms. Creedon. Yes, sir. There is a White House-led process 
called--it is an interagency process. All of the entities that 
have any interest in space participate in this process. It gets 
together to meet periodically depending on when there are 
issues. For instance, one of the meetings was in January and 
February about dealing with the space code of conduct, and that 
is where the interagency got together and said, yes, this is 
something that is important and we are going to go work on. So 
it is there. It exists and it is pretty good.
    Senator Nelson. Is it? So it is at least somewhat 
successful in breaking down the stovepipe approach to get 
cross-fertilization and cross-cooperation within the 
interagency system?
    Ms. Creedon. It is and it is also a good forum if there are 
issues that need specific resolution or specific input or 
guidance. It serves that function as well.
    Senator Nelson. Does it function pretty much automatically 
or does it have to be enforced?
    Ms. Creedon. Because it is run by the White House, 
enforcement generally is not an issue. When the White House 
calls a meeting, everybody shows up.
    Senator Nelson. So there is some force behind it then when 
that occurs that way.
    General Shelton, I understand that you effectively canceled 
the space test program and the ORS program due to lack of 
funding. I think we both feel that there ought to be some sort 
of backup system in place, and I wonder if the information we 
have is accurate.
    General Shelton. That is part of the President's budget 
request for fiscal year 2013, Senator. It was after 5 years of 
ORS, we felt like we had taken away quite a few lessons 
learned, and it was time to mainstream those concepts 
throughout all of our programs but yet continue things like 
hosted payload opportunities, further resiliency concepts, 
those kinds of things. So we will centralize the intellectual 
capital, if you will, in the Space and Missile Systems Center 
long-range planning staff. We will continue to have the kind of 
support we have at Kirtland today out of the Space and Missile 
Systems Center. So we will continue the conceptual work. It 
does not end.
    Senator Nelson. You are making do with what you have, but 
if you had your druthers and if you had the additional funding, 
would you prefer to have kept the programs going?
    General Shelton. Senator, that is a tough question. We wish 
we had fiscal year 2012 level funding across the board to tell 
you the truth.
    Senator Nelson. I suspect that there are opportunities to 
give up those things that you would like and those things that 
you would want, but it is a tough choice when it is something 
you need.
    General Shelton. It does make for very difficult decisions. 
We did protect the foundational space capability, missile 
warning, GPS, satellite communications, all those things that 
are foundational for our brothers and sisters in all services 
that we highly depend on not only for warfighting capability, 
but for national capability as well. All of that was protected. 
Hard choices had to be made.
    Senator Nelson. In terms of just missile warning, what is 
your biggest concern in strategic missile warning right now, 
General?
    General Shelton. Senator, in strategic missile warning, we 
are not in the place where we would like to be and being able 
to take full advantage of our latest satellite, SBIRS 
Geosynchronous Earth Orbit-1. It has two sensors. It has a 
scanning sensor and a staring sensor. The scanning sensor we 
can take advantage of today. The staring sensor, which provides 
a wonderful capability and our testing has been fantastic. In 
fact, we are seeing probably a 25 percent or more sensitivity, 
better sensitivity than we had expected out of that satellite. 
What that allows you to do, of course, is much dimmer targets, 
lower classes of missiles, lots of things that infrared 
capability will give you. We are not able to take full 
advantage of that in real time.
    Now, we are taking advantage of that in the intelligence 
agencies by shipping the data out to them, but that is a 
reactive kind of thing instead of being able to see it in real 
time.
    Senator Nelson. General Formica, I understand that SMDC/
AFSTRAT completed a successful test of the Advanced Hypersonic 
Weapon (AHW) which is one of the several designs under 
development as part of U.S. Strategic Command's (STRATCOM) 
conventional prompt global strike requirement. Obviously, 
congratulations are in order.
    Can you explain this successful test and how it was 
coordinated with other Army functions at Redstone and perhaps 
elsewhere?
    General Formica. Mr. Chairman, thank you. Of course, we are 
very proud of the success of the AHW test, and I am very proud 
of the civilians and the military personnel that worked hard to 
bring that test to successful completion.
    The technology for the AHW test really began with the work 
at Sandia Laboratory and then was matured at Redstone Arsenal 
in technology development with the Aviation and Missile 
Research, Development, and Engineering Center (AMRDEC), and the 
SMDC/AFSTRAT engineers. That brought for successful technology, 
and the AMRDEC's contribution was really the development of the 
thermal protection system which was fundamental to the success 
of the technology.
    The test itself took the efforts of the Navy as AHW was 
launched from the Pacific Missile Range Facility in Hawaii. It 
landed at the Army's Reagan Test Site, Kwajalein Atoll, having 
traveled 2,100 nautical miles, and took advantage of Army, 
Navy, and MDA test assets. So it required the collaboration 
both in technology development and in test operations of 
several organizations, many of them Redstone-based. It took the 
leadership of the OSD and prompt global strike, and it would 
require the same kind of cooperation and collaboration as we 
move forward.
    Senator Nelson. It is nice when you get this kind of 
cooperation to get the result that you have had. Please share 
the congratulations with the other participants as well. Thank 
you.
    General Formica. Thank you, Mr. Chairman.
    Senator Nelson. Senator Sessions.
    Senator Sessions. Thank you.
    Ms. Creedon, in your statement you talk about the code of 
conduct with the Europeans over space as just the beginning, 
which is a bit troubling to me because it does have treaty-type 
implications. I would like to be confident that the U.S. 
Government, DOD is not making commitments with regard to what 
we plan to do that will bind us and maybe make it impossible 
for us to effectively maintain our space and missile defense 
capability that we need because we need to be able to dominate 
space really.
    So can you give me some reassurance on that? What is the 
nature of the beginnings and where do you see it going?
    Ms. Creedon. Senator, we are just beginning the discussions 
that we hope will lead to a voluntary code of conduct.
    Senator Sessions. Is this mainly driven by the debris 
question?
    Ms. Creedon. Debris is a major aspect of this. We are also 
looking at making sure that there is not radio frequency 
interference with satellites. There are a number of responsible 
behaviors that we hope this code will identify and then set 
what would be the norms for which responsible space-faring 
nations would conform their conduct.
    Senator Sessions. One of the things that seems to concern 
itself with is an arms race. As one wise observer at one of our 
hearings said when asked, ``are we going to have war in 
space,'' he said, ``we have had war on the land. We have had 
war on the water. We have had war in the air. I suspect we will 
have war in space one day.''
    I think it is hard to write a piece of paper that says we 
are not going to defend our assets or utilize capabilities we 
have to save lives and defend America's sovereignty and 
security.
    So I guess there is some emphasis, I understand, in the 
talks about preventing an arms race in space. Is that involved 
in this, and if so, we need to be very careful about it.
    Ms. Creedon. Sir, one of the fundamental tenets of this 
discussion of the code of conduct would be the inherent right 
of self-defense reserved to every country that would be a 
voluntary participant in this code. So that is also one of our 
major goals. If we are not successful as we go through the 
discussions over the course of the next year or so in 
negotiating a code of conduct that is in our national security 
interest, then, frankly, we would not sign it. It is not about 
limiting capabilities. It is about responsible behavior. It is 
not a treaty. It is not an arms control treaty. It is not any 
sort of a legally binding undertaking. It would be a voluntary 
code of conduct trying to get other space-faring nations to, in 
many respects, adapt the behavior that, frankly, we have in 
terms of being a responsible space-faring nation.
    Senator Sessions. I would hope we would all be responsible 
utilizers of space, and I think pressure should be put on 
nations to behave in responsible ways. I certainly do not think 
there is anything wrong with that, but I am not sure you always 
gain a lot by formalizing written agreements that can be turned 
around and be used against the United States since we are the 
premier space utilizer.
    The DOD Joint Staff analysis provided to the House Armed 
Services Committee states that if the United States, ``were to 
make a good faith effort at implementing the requirements of 
the draft code,'' it could likely have an adverse impact on 
military operations. Have you recognized that statement, and is 
what you are doing designed to make sure that we do not 
adversely impact our operations?
    Ms. Creedon. Yes, sir. One of the decisions that we made 
when we decided to go for the code of conduct was informed by 
the analysis that was tasked by the OSD about a year ago to the 
Joint Staff and to STRATCOM to look at this underlying document 
that the EU had put together and to provide guidance to us as 
to what needed to be modified, changed, eliminated, added so 
that it would, in time, be a document that would be in our 
national security interest. We have used the work of the Joint 
Staff to begin these negotiations which will kick off at a 
fairly low level, but will kick off for the first time in June.
    Senator Sessions. I have doubts about whether it is that 
wise or not. So you are contemplating that we would actually 
sign a document?
    Ms. Creedon. That would be the goal.
    Senator Sessions. ``We'' who? Would it be DOD, or DOS, or 
the President, or who?
    Ms. Creedon. It would be the United States, and the goal 
would be to sign an agreement at some point if it is in our 
national security interest to do so. If it is not, we will not.
    Senator Sessions. Would you consult Congress before you 
were to sign such an agreement?
    Ms. Creedon. Of course. Between meetings and some briefings 
and discussions, already, I think, we have had on the order of 
about six or seven discussions with various committees now, and 
we would absolutely keep Congress informed--all the 
committees--as to where we are in the progress and if we are 
making progress or if we are not.
    Senator Sessions. Europeans ceded their sovereignty to 
Brussels. They do not worry about those things too much. But 
most Americans do and they want to maintain our legitimate 
range of actions, and we have burdens around the world that the 
Europeans do not feel and do not carry and we need capabilities 
that are not so important to them that could be for us. I would 
just urge you to be very cautious before you sign agreements 
that could in any way complicate our ability in the future to 
take reasonable actions for our national interest or to support 
our allies in that fashion. So it will be something, I think, 
Congress will be interested in and watching.
    Thank you, Mr. Chairman.
    Senator Nelson. Thank you, Senator.
    General Shelton, I think we are all so painfully aware of 
the lack of competition in space launch and the recent critical 
GAO report on the use of a single vendor. I understand now that 
the Air Force has issued a new entrant criteria based on Air 
Force mission assurance standards. Can you describe what 
efforts you are currently undertaking to bring new launch 
entrants to the Air Force, what payloads you are providing for 
launch to the new entrants, and what would be the timeframe for 
something to materialize to create this kind of a potential 
competition?
    General Shelton. Senator, we have done two things. We came 
up with a new entrant strategy and a new entrant guide, a 
certification guide, both in October of last year, and that is 
a fundamental part of our reacquisition of EELV capability that 
is in the very near future here. Those new entrants--their 
maturity really is going to drive the rapidity that we can 
bring them on board.
    We have reserved two missions that we will not compete with 
the EELV contractor, Discover-2 and STP-2. Those two missions 
will be set aside. They will be competed. Any new entrant will 
be able to compete, and if they show that they have the 
maturity, they have the technical capability to launch those 
missions, we will go on contract with them. That will be a step 
along the path toward certification for any new entrant.
    But again, for a national security payload, something that 
is a national treasure, we will be very cautious as we bring 
them on board and we launch a national security payload on top 
of a new entrant.
    Senator Nelson. This is essentially the same question I 
asked to Secretary Creedon, General Shelton. Can you explain 
the importance of Air Force spectrum in general and how any 
movement from it should be paid for and coordinated so that 
there are not unfortunate implications to your budget?
    General Shelton. Secretary Creedon said it very well, that 
we are heavily dependent on the radio frequency spectrum for 
almost every operation. In the case of the part of the spectrum 
that is being talked about now in terms of repurposing, we have 
satellite operations in that part of the spectrum and are very 
concerned that vacating that part of the spectrum would be both 
long-term and expensive, anywhere from somewhere around the 
neighborhood of $240 million all the way up to $2 billion, 
depending on which option you chose. So we are watching this 
very closely and are very concerned.
    There are three things that we are concerned about that 
would have to come together simultaneously to make this work. 
First, is finding alternative comparable spectrum. Second, is 
having enough time to plan for vacating that part of the 
spectrum. Third, having the resources, either through the 
auction or appropriations. I could not pay for it today. If 
somebody came to me with a $2 billion bill to vacate part of 
the spectrum, I could not pay it.
    Senator Nelson. I understand.
    General Formica, the same question of you.
    General Formica. Yes, Mr. Chairman. As Secretary Creedon 
and General Shelton have said, the spectrum is obviously a 
requirement for Army operations. The area of the spectrum that 
we are talking about principally would affect radar and 
satellite communications for the Army, and it is our interest 
in this that we would continue to have the spectrum 
capabilities that would enable us to do military operations 
without an increased cost to the Army.
    Senator Nelson. So all of you agree it is not a very good 
pay-for for some other program that is not otherwise paid for.
    General Shelton. Certainly the promise of the auction would 
produce quite a bit of money if the projections are right, but 
it is how that money then gets rolled back into repurposing.
    Senator Nelson. General Formica, unlike the ORS 
cancelation, I understand you continue to invest in small 
tactical satellites that can be rapidly fielded. Do you see a 
future in small rapidly responsive satellites for our Army's 
soldiers, and if so, what is your vision for such a program?
    General Formica. Mr. Chairman, we are absolutely trying to 
move forward with technology demonstration for nanosatellites. 
We have demonstrated nanosatellite capability for digital 
communications relay in what we call SMDC-1, which had its 
initial test flight last year. We are developing nanosatellite 
capability for imagery in what we call Kestrel Eye. Those two 
programs, which would be an augmentation to the national and 
joint space capabilities that are already provided to our 
soldiers, would be envisioned to provide rapidly responsive 
satellite capability at the tactical level. That is why this 
joint technology demonstration program is so important to us.
    We are encouraged that they have received support at OSD, 
and again, we look forward to favorable consideration by 
Congress in funding those.
    Senator Nelson. I understand that you operate the wideband 
global satellite. Are you experiencing problems with bandwidth 
based on the use of more unmanned systems, and as that 
continues, will that make matters even more challenging?
    General Formica. Mr. Chairman, we do operate five wideband 
satellite operation centers around the globe. By the way, I am 
very proud of the soldiers that operate those centers 24 hours 
a day, 7 days a week, to bring capabilities to our warfighters.
    Managing bandwidth is always a challenge in the wideband 
satellite operation centers.
    With respect to unmanned systems, we do not currently 
manage the bandwidth that allows the unmanned systems to 
transmit down to the ground station, but we do manage the 
bandwidth for the dissemination of that data, processed data, 
once it leaves the ground station and goes out to Army users.
    Future capabilities in the wideband satellite system will, 
in fact, enable us to manage bandwidth for the direct downlink 
to the ground station.
    Senator Nelson. Thank you.
    Senator Sessions.
    Senator Sessions. General Shelton, an unclassified excerpt 
from the executive summary of a Joint Staff operations 
assessment dealing with the draft EU code says, ``if the United 
States were to make a good faith effort at implementing the 
requirements of the draft code, there could be operations 
impact on U.S. military space operations in several areas.''
    Has that been communicated in detail to the negotiators who 
are working on this?
    General Shelton. Absolutely, Senator. We are in lockstep 
with Secretary Creedon's office, with STRATCOM, and others in 
making our views heard as well.
    Senator Sessions. Now, could you explain why there would be 
operational impacts on the military and intelligence community 
and under what authority DOD and the Intelligence Community 
would express those restrictions?
    General Shelton. I do not know that I quite follow the 
question, Senator.
    Senator Sessions. Can you tell us in this session some of 
the operational impacts that might occur based on some of the 
drafts that have been floated out there?
    General Shelton. Just as an example, if somebody were to 
prescribe distances from satellites, that might be something 
that would be tough to live with. If someone were to say 
absolutely zero debris, that might be something that would be 
tough to live with. So those kinds of restrictions we would 
want to watch very closely. We are all about minimizing debris. 
It does not take a very big object in space moving at orbital 
velocities to destroy a fragile satellite. But we want to 
preserve our freedom of action in space through any kind of 
code of conduct, and I know that is exactly where the OSD is on 
this as well.
    Senator Sessions. Have we ever had a situation in which a 
satellite has been damaged by debris?
    General Shelton. We have.
    Senator Sessions. How many times?
    General Shelton. We know of a couple of times. It is very 
difficult to do the forensics. It might be a small enough piece 
of debris that it was not even in our satellite catalog. So you 
have to go backwards and try to figure out if that is exactly 
what happened.
    A very famous case is a paint chip that got embedded in the 
windshield of the Space Shuttle. So it can be a very hazardous 
environment.
    Senator Sessions. I remember this from high school, I 
think, this science fiction novel, and everybody on the Earth 
had been killed and these people had plotted and they had this 
rocket that they were going to fly to Mars or somewhere. 
Everybody that made it on the rocket was going to survive. They 
took off and ran into a Sputnik and all were killed. 
[Laughter.]
    So that is typical science fiction.
    But I guess it is possible that we can have those kinds of 
events, but it is a big space up there, a lot of space in 
space. We cannot alter everything we do based on that.
    We do a pretty good job of tracking that so you can avoid 
those areas. Is that not correct, General Shelton?
    General Shelton. To the best of our ability. We can get 
down now to about an object the size of 10 centimeters or so. 
We are going to get better. We will get down to about a 
baseball-sized object with some capability we have planned.
    Senator Sessions. All right, good.
    Thank you all for your work. We know, as the chairman and I 
both have learned, just how critical your work is to the men 
and women who are at risk on the ground in Iraq and 
Afghanistan, on ships and airplanes. They need these 
capabilities. We are reaching a point where a determined 
hostile power could neutralize a considerable portion of it, I 
would think. In the scheme of all the expenditures we make, we 
do not need to be in a position where we are not able to 
respond to that and maintain that advantage. So I hope that our 
research, science, technology, testing, and your thinking about 
the future will not put us in a position where we have 
overlooked some danger to our capabilities and comprise our 
security.
    So thank you for what you do.
    I would have to say, for the most part, what has been 
achieved by space science on missile defense exceeds what most 
people thought was possible 25 years ago. It is just 
unbelievable the capabilities that we have now achieved. As 
that science improves, there are probably ways to neutralize 
those capabilities by hostile powers.
    Thank you for what you do.
    Thank you, Mr. Chairman, for your leadership.
    Senator Nelson. Thank you, Senator.
    Madam Secretary, is it fair to say that the agreement that 
we are looking for is one of developing stewardship over space, 
recognizing that there are those who still discard paper or 
trash or something without regard to the implications for the 
environment, let alone for aesthetics? But we are not dealing 
with aesthetics here. We are dealing with the reality of people 
just not necessarily caring or not being encouraged to care for 
space the same way we want to encourage it and take care of our 
environment on earth. Is that a fair way of saying it? It is 
dangerous as well.
    Ms. Creedon. Yes, sir. That is a large part of it. There 
are other aspects that we hope could be achieved in the code as 
well, things that would say improve the ability to understand 
other activities and other actions. So if someone was going to 
move a satellite, there would be an understanding of why that 
satellite was moved. So part of this is to reduce the risks of 
not only mishaps but mistrust and misconduct, misperceptions. 
Just improve the overall understanding in situational space as 
well.
    Senator Nelson. There are some that are better actors than 
others. Is that fair to say?
    Ms. Creedon. That would be a true statement.
    Senator Nelson. Mr. Winokur, the Navy is proposing to 
develop a radar altimeter with NOAA to place on a European 
Space Agency satellite as a means to save on the cost of 
developing a standalone satellite. What are your plans with the 
fiscal year to develop this system, and what will happen if it 
is not developed in time for the satellite launch? Will it be a 
day late and maybe a dollar short?
    Mr. Winokur. Thank you, Mr. Chairman. Yes, we definitely 
will be a day late and a dollar short.
    The Navy had plans to launch its own radar altimeter 
satellite which measures sea surface height which, in turn, 
supports our tactical anti-submarine warfare operations. 
Unfortunately, due to fiscal pressures, we terminated or 
deferred those plans for what we call GFO-2.
    Our mitigation strategy was to work with our civilian 
colleagues at NOAA and, in turn, their colleagues and, in fact, 
U.S. allies and some of the European space agencies to see if 
we can partner and leverage what is called Jason-3. So the Navy 
plan is to use, frankly, residual dollars in a one-time only 
funding transfer to NOAA to help keep Jason-3 on schedule. We 
are very concerned about the potential for an altimeter gap, 
and without the Navy funding, it is likely that Jason-3 will 
slip a minimum of a year. It has already slipped, frankly.
    Our goal is to work for a calendar year 2014 launch. We 
have had serious conversations with NOAA that if maybe funds 
become available, and that would give the Navy a voice at the 
table and a say, actually an assured access to the data. So we 
think this is a reasonable mitigation plan for the Navy to get 
what we need at a minimum cost.
    Senator Nelson. Mr. Zangardi, I am going to ask you the 
same question that was asked of Secretary Creedon. Can you 
explain the importance of preserving your operating spectrum in 
general and how any movement from it should be paid for and 
coordinated from your perspective, the Navy's?
    Dr. Zangardi. Yes, sir. Secretary Creedon answered the 
question quite well, and I would echo her comments and General 
Shelton's and General Formica's comments.
    Both the Navy and the Marine Corps use spectrum for land, 
air, and space operations with communications systems, sensors, 
radars, navigation, and guidance systems. Spectrum access is 
critically important to the Navy and Marine Corps warfighter. 
Further erosion will reduce operational capabilities and 
endanger possibly military personnel. We see, as we move 
forward into the future, a greater reliance upon spectrum.
    Coming from the acquisition side of the Navy, I tend to 
look at it in terms of cost, schedule, and performance. In 
terms of schedule, we need time to assess any impact of a 
spectrum move. In terms of cost, we have to understand the 
cost. What will it cost to move it? There is a performance 
piece here. So if you move the system, what is the impact to 
the performance of that particular system?
    Senator Nelson. I think everybody can see what we are 
clearly doing. We are setting the record so that we do not have 
to go through this unexpectedly at some time in the future 
without having the backup testimony available to explain why 
somebody cannot just pull the spectrum away and think it is 
okay.
    On commercially hosted payloads, Mr. Winokur, your 
testimony describes the work that you are undertaking with the 
commercial sector for ISR. Are you able to describe your 
activities in these areas? For example, are you utilizing 
hosted payloads on a commercial satellite?
    Mr. Winokur. No. At this point, the Navy is not planning on 
using a specific hosted payload for ISR purposes. What we are 
doing is leveraging the funding that is available through the 
National Geospatial Agency (NGA) for access to some of the 
commercial data that is provided through synthetic aperture 
radar providers and some of the electro-optical systems. Our 
goal actually is to leverage available commercial systems, 
develop unique Navy-specific applications using the available 
data, and leverage NGA resources to the maximum extent 
possible.
    Senator Nelson. Dr. Zangardi, congratulation is coming your 
way as well on launching MUOS last month, and I am happy the 
system is finally being fielded. I understand the next one will 
be in 2013 to make the system operational at that time.
    My question to you is when will we have ground terminals 
deployed that can use the advanced signal of the system. The 
GAO indicates that it could be as late as 2014. Do you agree 
with that? Do you have another point of view?
    Dr. Zangardi. Yes, sir. I have been around both the Joint 
Tactical Radio System (JTRS) program which is developing the 
radio or terminal that will port this waveform and around the 
MUOS program for many years.
    We have made significant progress in the past year 
synchronizing the MUOS SATCOM program with its waveform 
development and JTRS Manpack Terminal Integration by 
establishing one lead JTRS MUOS manager working with the Navy, 
Army, and JPEO JTRS. We project that the MUOS waveform will be 
certified and ready for porting into the Handheld, Manpack, 
Small Force Fit Manpack Radio by September 2012.
    JTRS Manpack terminal appliques will start rolling off the 
production line in late 2013. That being said, we expect to 
have our over-the-air certification test or multi-service 
operational test and evaluation conducted in early calendar 
year 2014 from MUOS, and that will require 50 Navy JTRS Manpack 
radios.
    The Multi-Service Operational Test and Evaluation (MOT&E) 
requires two MUOS satellites plus the ground stations. So we 
are dependent upon launching the next MUOS satellite in July 
2013 for it to be operational by our MOT&E. Following a 
successful MOT&E, we will continue delivery of the Manpack 
terminals across all the Services, and we anticipate using more 
of the advanced signal of MUOS as we move to 2014.
    Also inherent within the MUOS satellite is a legacy UHF 
package, similar to the UFO satellites that are currently 
flying. That package provides a graceful transition period 
between the existing SATCOM capability and our future MUOS 
capability.
    Senator Nelson. Thank you.
    Senator Sessions.
    Senator Sessions. Thank you, Mr. Chairman.
    The chairman will be back in just a minute, and I have 
another meeting that I have to attend.
    So I want to thank all of you for your presentation. This 
is something I take very seriously. I hope that you will 
cooperate with our staff. We want to be sure that we are frugal 
and we do not waste a dime because we do not have a dime to 
waste. This is really so, really so.
    There will be demands for expenditure cuts time and time 
again, and all of you want to be good DOD members. But I would 
just urge you to stand your ground when something is really 
important, and if we ask about it here, you will have to tell 
us even if it requires you to be somewhat at odds with 
somebody's superior because that is the deal. Right? You come 
here. You have to tell us your best judgment. We are asking 
your best judgment.
    But it is not going to be a pretty sight because we are, 
indeed, borrowing about 40 cents of every dollar we spend. The 
trends do not get better. They actually get worse, and the 
budget that the House has put forward would eliminate the 
sequester on DOD, the one they announced yesterday, and maybe 
even reduce some of the cuts you were looking at already. But 
regardless, they would not go forward with the next sequester, 
and they would yet have the same savings, but they find them 
across the whole budget and not targeting DOD as the sequester 
now does.
    I could ask you what the impact of the sequester would be, 
but I know, General Shelton, you told me what I am hearing from 
everyone, including Secretary Panetta, and that is that you 
think you can sustain the cuts that have been required, $480-
something billion, but another $500 billion would be 
devastating to many of the programs that we now depend on.
    So that is our challenge. Keep looking for ways to maintain 
our capabilities at less cost. I know you will do that, and if 
something is critically important and does not need to be 
eliminated, you will have to tell us and maybe we in Congress 
can say, well, some other program ought to pay a little bit 
more price and maybe we can save this critical program. So that 
is what I would like to share with you.
    The chairman will be back in a few moments; thank you for 
standing by. [Pause.]
    Senator Nelson. Dr. Zangardi, the Director of Operational 
Test and Evaluation (DOT&E) reported that in 2011, the Navy 
recently experienced a mean time between failures of 892 hours 
instead of the required 1,400 hours of the Navy Multiband 
Terminal (NMT) system. What actions are you taking to remedy 
this situation, and when do you expect to have the full rate of 
production at the terminals? I think you can sense that we are 
concerned about making certain that there is a connection with 
the terminals for full utilization.
    Dr. Zangardi. Yes, sir. We pay very close attention to NMT.
    So first off, the demand signal from the fleet for the Navy 
multi-man terminal is high. They want it now. The current 
antennas, the WSC-6, for example, requires significant 
maintenance. We recently conducted a gate review or it was just 
a general in-depth review of the program in January, and as 
part of that, we--myself and the program manager--came over 
here and briefed each of the four defense committee staffs on 
the program and it was exactly on this point here.
    The DOT&E found that NMT is operationally effective, but 
that it is not operationally suitable. The systems reliability 
tested below threshold, and the key reasons included 
operational availability, for sure, and long lead times for 
system maintenance. So the maintenance drivers were basically 
failure diagnosis timelines and logistics delays of spare 
parts.
    Let me give you a brief example. We also believe we have 
solutions in place for these.
    On one of the shore facilities, the power supply for a fan 
failed during the test. The system continued to work. However, 
it was logged as a failure of the system because there was a 
part failure. So that counted against it. The system operated. 
Communications continued, but it was a failure. Most of the 
failures that occurred during this OT&E were like this.
    We believe we have corrected the issues, and for all the 
systems that are being procured in the future and all of those 
that are coming off the assembly line, the contractor will be 
putting in place the fixes at no cost to DOD.
    The lessons learned for failure diagnosis are being 
incorporated into the on-board diagnostic tools and technical 
documentation, as well as updating all the training curriculum. 
Naval Supply is working to optimize sparing levels, and we 
expect to see continued improvements in this area, in other 
words, get the parts out there in time. So part of the new 
program is really what happens when you have outed so you can 
anticipate and optimize the sparing levels.
    We believe that NMT is currently on track to conduct a 
follow-on OT&E event in June of this year. We anticipate that 
the full rate production decision will be in the fall of this 
year. Currently, the program is in a low-rate initial 
production.
    Senator Nelson. I understand that TacSat-4 is proving to be 
a success meeting warfighters' requirements for a small, 
rapidly fieldable satellite that can communicate in urban and 
mountain terrain. I understand that the ORS office helped 
launch this satellite.
    Do you think these satellites are proving their utility for 
the investment that has been made so far?
    Dr. Zangardi. Yes, sir. I would like to hold off on 
providing you an assessment on that until the Joint Military 
Utility Assessment is completed later this year, and we can 
provide you formal feedback from DOD as to whether or not it is 
operationally effective or useful.
    Senator Nelson. Okay. Thank you.
    [The information referred to follows:]

    The Joint Military Utility Assessment report is scheduled to be 
released on August 1, 2012. After reviewing the report, the Department 
of Defense will be able to provide the committee with formal feedback 
regarding the usefulness and operational effectiveness of TacSat-4.

    Senator Nelson. Ms. Chaplain, we seem to be finally putting 
satellites in orbit, but it seems that talking to them on the 
ground is now a challenge. So my understanding is that we are 
delayed in the ground terminals, as we have just heard a little 
bit here, terminals for GPS III, MUOS, SBIRS, and AEHF. The 
problem is so bad with AEHF that the contract for its ground 
terminal, called the FAB-T, is being restructured, leaving the 
B-52 and B-2, our nuclear bombers, with only a very low 
frequency capacity. I understand that we may have a Nunn-
McCurdy breach on the FAB-T program.
    If you would, please provide us with your overall 
recommendation for remedying this DOD-wide problem, and can you 
give the committee legislative drafting assistance to avoid it 
from happening in the future?
    Ms. Chaplain. Yes, of course, we love providing assistance 
where you guys need it on writing legislation. [Laughter.]
    We have done work in this area, even on this problem, in 
particular, and we had a number of recommendations. DOD has 
been taking actions, but I think a couple things are still 
outstanding.
    First, is making sure that the ground programs and the user 
programs do adopt best practices and, most importantly, 
understand the complexity of what they are trying to achieve 
when they set out to do it. I think with JTRS and FAB-T that 
understanding was not quite there.
    The second thing is having good insight into the 
synchronizing between user ground systems and satellites 
throughout the life of a program, and that would include 
activities within DOD but also insight on your part. I know DOD 
has started some of the activities on their part, but the more 
they can conduct enterprise-level reviews on this issue, the 
better.
    On your part, if Congress could require some reporting that 
illustrates the status of these programs, the ones that are 
linked together, on a regular basis, you would have insight, 
and then when you see the disconnects coming down the road, you 
can do something about it. Too often it just appears as a 
surprise when it is already too late. We have launched a 
satellite and everyone is happy, and then everybody realizes, 
uh-oh, it is not going to be fully utilized for a couple years. 
So having that kind of insight is very important really early 
on.
    Senator Nelson. Thank you.
    I am going to ask you the same question about preserving 
the operating spectrum in general and how any movement should 
be paid for and coordinated from your vantage point from the 
GAO.
    Ms. Chaplain. I think it is hard to even understand the 
cost without knowing where you would move to. That is the first 
question that has to be answered.
    Another thing I think that has not been discussed today is 
really how difficult it would be to get satellites to move to a 
new spectrum. All the satellites that are out there cannot just 
get a simple fix to move to spectrum, and you just cannot 
simply replace them all. That would just be a tremendous, 
tremendous cost. Even with ongoing programs like GPS III, to go 
into that program now and change the requirement for spectrum 
would create a lot of disruption and a lot of cost increases 
and schedule delays, and that is not a program where we want to 
see more of that.
    Also, when we talk about the word ``resilience'' in terms 
of space policy, I look at it as very applicable in this 
situation because the particular spectrum that they rely on for 
satellite control networks is one of the optimum pieces of 
spectrum for maintaining resiliency. When satellites have 
trouble and they are spinning out of orbit, the wideness of the 
spectrum allows DOD to correct satellites that are having 
issues. So it is important to remember that these certain types 
of spectrum that are being used for satellite control is there 
for a reason.
    Senator Nelson. Thank you.
    I think lurking in the background of this whole hearing is 
how DOD can be innovative in the design, cost, and launch of 
satellites. The ORS program was supposed to be the competition 
in DOD like DARPA to do that. In your opinion, was the business 
case or model for ORS working? If Congress could fund it, would 
you concur that it should be funded?
    Ms. Chaplain. Yes. We try not to be advocates for programs, 
but we certainly have always endorsed the goals of the ORS 
program. I think some of them have not really been brought out 
today. In addition to developing smaller and more responsive 
satellites, there were other goals in that program: to lower 
the cost of launch, to standardize design methods, and to 
standardize satellite buses. So while maybe you would not have 
a whole barn full of satellites ready to, you might have a barn 
full of pieces that you could put together in rapid order.
    In moving forward, if the program is canceled, I just do 
not see yet the way forward for how lessons learned are going 
to be incorporated elsewhere in DOD. There had been resistance 
to that program and what it was doing, and we did not see the 
big programs making progress to adopting these kind of 
philosophies. I would like to just see a formal plan for how 
ORS is going to be evolving in other places in DOD if it is 
going to be canceled.
    Senator Nelson. Thank you.
    Just a general overall question. What do you see today as 
the largest single acquisition challenge to space systems?
    Ms. Chaplain. I think it is something we have been talking 
a lot about today, and that is: affordability. It creates a lot 
of good challenges because it makes you find ways to do things 
more efficiently. It incentivizes you to adopt things like best 
practices, but at the same time, it has raised a lot of 
questions about where are we going next and how are we going to 
pay for it. When you look across the portfolio of defense space 
systems, there really are not many that you would say should be 
cut. They all provide very, very important capabilities.
    So when you make these kinds of decisions, they really do 
need to be made with a Government-wide perspective and with the 
idea that agencies are going to coordinate more to optimize the 
investments they do have. We do not see enough of that kind of 
strategic thinking across Government and that coordination that 
is really focused on optimizing investments. There is 
coordination. It happens here and there, but we just do not see 
it in a concerted way when it relates to the issue of 
affordability.
    Senator Nelson. Thank you.
    We have asked a number of questions and received a number 
of answers; but are there questions that have not been asked 
yet that you would have answers to that if you had been asked, 
you would offer us answers? In other words, what have we not 
touched on today that perhaps we should have or something that 
we should know that we have not explored? Anything in 
particular? Or do you think we have done just enough? If there 
is something else that you would like to offer, we certainly 
want to give you the opportunity.
    General Shelton. Senator, we have touched on this, and I 
said this privately to you earlier. But there is undoubtedly a 
foundational level of space capability that regardless of force 
structure size in DOD, regardless of almost any other decisions 
made from a budget perspective, that space capability has to 
continue. If we are going to continue to fight wars the way we 
fight wars today, and in this era of information-enabled 
warfare, there is such a heavy dependence on space capabilities 
that I think that that foundational layer just has to continue.
    Senator Nelson. General Formica, anything you would like to 
add?
    General Formica. Mr. Chairman, I would obviously echo 
General Shelton's comments. They are very consistent with what 
I said in my opening statement and consistent with the approach 
we bring. We are reliant on space. There is no going back. If 
we are going to shoot, move, and communicate, we require space 
systems. I would absolutely endorse General Shelton's 
foundational basis.
    I do appreciate the opportunity to appear today, sir.
    Senator Nelson. This is more than parity for us. We have to 
stay ahead of the game. We cannot just be catching up or trying 
to stay at par with the rest of the world or otherwise our 
defenses are down. Is that fair to say?
    General Shelton. I would agree with that, and that is 
exactly what we try to do. Even though we talk about going from 
the R&D to the production phase, those capabilities are very, 
very good.
    General Formica. Mr. Chairman, I would just add, those are 
the critical enablers that will allow us to get better. 
Especially as we look at force reductions and other 
efficiencies, it is those critical space enablers that will 
make a difference.
    Senator Nelson. We cannot state definitively that it is 
always just about money because it is about other matters as 
well. But adequate funding is going to be important to our 
progress as well. That is why, I think, it is important to get 
the funding right. But in the process, we need to be sure, and 
I know GAO and Ms. Chaplain are interested, as we all are, in 
making sure that we get it right, for whatever dollar we spend, 
that we get the result that we are seeking or otherwise we are 
not maximizing or optimizing what opportunities we have.
    Mr. Winokur, any comments that you might like to add?
    Mr. Winokur. I think the only thing I would add, Senator, 
is actually picking up on one of the comments you made in your 
introductory remarks. So if you allow me to wear my 
Oceanographer-of-the-Navy hat, we are very concerned about 
affordable, next-generation weather satellites. We in the Navy 
are very dependent on the civil community and the Air Force 
since we do not fly our own weather environmental satellites. 
From our perspective and from a national perspective, I think 
affordable, next-generation weather satellites become very 
critical not only from a DOD perspective, but from a national 
perspective as well. So I think that would be the one thing I 
would add.
    We in the Navy are working very closely with the Air Force, 
as I mentioned in my introductory remarks about defining our 
needs, and we are working closely with NOAA as well and 
defining our needs to them so we can leverage their capability 
and planning.
    Thank you.
    Senator Nelson. Dr. Zangardi?
    Dr. Zangardi. Yes, sir. Thank you for this opportunity to 
give you a last remark.
    We are clearly heavily reliant on space, and given the 
current budget environment, it is becoming increasingly 
important to focus our efforts on delivering our space programs 
on time and on budget. I think we have made great strides over 
the past few years to move the Navy programs in that direction.
    I would like to say that since I have been in this role, I 
have seen great cooperation among the Services. I find that we 
work very well together in trying to bring these future 
capabilities to bear for the warfighters.
    Thank you, sir.
    Senator Nelson. Last, but not least, Madam Secretary?
    Ms. Creedon. Thank you, Senator Nelson.
    One of the things that I have really gotten to participate 
in and I think has gotten better since I went to DOD--and 
nothing to do with me, it is just getting better--about 18 
months ago, DOD stood up the Defense Space Council, and it is 
chaired by the Secretary of the Air Force. He is chairing this 
in his role as the Executive Agent for space for DOD. The 
Defense Space Council brings all of the various aspects of DOD 
together, all of the Services, and the Comptroller's Office. It 
brings together the intelligence side, so NRO, and the policy, 
the General Counsel's Office. It brings everybody together to 
work on and to stay focused on the space systems, space budget, 
space architectures.
    I have to say I have been very impressed with how this 
group, which meets notionally monthly, 4 to 5 weeks, something 
like that, really has taken on some pretty difficult issues and 
is looking at a lot of the space issues in a very holistic 
manner. So right now, the Defense Space Council is undertaking 
two very large architecture studies to look at how you 
coordinate across the various Services for various 
requirements.
    I think this addresses a little bit what you had raised 
earlier about, are we looking at making sure that the money is 
utilized, that there is good cooperation and coordination, at 
least within the national security space community. Obviously, 
it does not address so much outside, but it is really a very 
good body and it has really taken on some very difficult topics 
of discussion, including ORS, as it works through the various 
space issues. It is taking a growing role in budgets. So I have 
been very impressed with this organization and its efforts 
since I have been there.
    Senator Nelson. It is encouraging to know that there is 
that effort at coordination and collaboration because if there 
is any quick way to lose opportunity or to miss optimization, 
it is everyone going off on their own way. It will increase the 
costs, I think decrease the efficiency and efficacy of being 
able to put something together in a far more comprehensive and 
cost-effective way. I appreciate that that is being undertaken.
    I thank you all for your presence here today and for your 
responses. If there is something at some point that we ought to 
have a behind-closed-doors session, let us know that and we 
would be glad to follow through on that. So I guess we will 
come back to make a decision about that a little bit later.
    Thank you all very much. I appreciate your testimony.
    The hearing is adjourned.
    [Questions for the record with answers supplied follow:]
           Questions Submitted by Senator E. Benjamin Nelson
                     fundamental space capabilities
    1. Senator Nelson. General Shelton, you have mentioned that we must 
preserve our core fundamental space capabilities in this tight budget 
environment. Can you list what they are?
    General Shelton. The core fundamental space capabilities are 
Nuclear and National Survivable Satellite Communications; Launch 
Detection and Missile Tracking; Position, Navigation, and Timing; Space 
Situational Awareness and Battlespace Awareness; and Defensive Space 
Control and Assured Access to Space.

                     global positioning system iii
    2. Senator Nelson. General Shelton, in your written statement you 
mention that the development of Global Positioning System (GPS) III is 
on cost and on schedule. In the Government Accountability Office (GAO) 
written statement, the GPS III program is identified as an acquisition 
program that is ``experiencing cost and schedule growth, though not to 
the extent yet as those experienced in the last decades.'' What are the 
challenges of the GPS III program and what are you doing to stay on 
cost and on schedule?
    General Shelton. The major challenges on the program are to ensure 
that we remain focused on addressing parts requirements, test 
equipment, detailed design, and first time integration complexities. 
The government accounted for these risks in the original estimates and 
budgeted accordingly.
    The government has added significantly more risk reduction 
activities and systems engineering rigor in the GPS III development 
program than in past acquisition reform programs. The program is 
resolving technical and manufacturing issues in the development phase 
so they are not carried forward into production. We expect our 
significant upfront investments in systems engineering, worst-case 
analyses, industry-leading parts standards, and comprehensive hardware 
testing will prevent expensive rework and retest of flight vehicles in 
the production flow. GPS III SV-1 is still projected to be available 
for launch in 2014, as per the original Acquisition Program Baseline 
(APB). The program is fully funded to the government Independent Cost 
Estimate (ICE).

                     air force research laboratory
    3. Senator Nelson. General Shelton, the GAO's written statement 
indicates that the planning efforts for investments at the Air Force 
Research Laboratory (AFRL) are not very strategic. How does AFRL 
interface with Air Force Space Command (AFSPC) to produce current and 
future AFSPC science and technology (S&T) requirements for space 
systems and capabilities?
    General Shelton. AFRL routinely interfaces with AFSPC primarily 
through the command's S&T Corporate Process which produces strategic 
investment strategies. The annual process begins with an AFSPC data 
call to all combatant commands, major commands, and selected 
operational units (e.g., National Air and Space Intelligence Center and 
the Joint Space Operations Center). AFSPC uses the responses to 
identify capability gaps and technical needs, which are then 
prioritized based on both the Space Superiority Core Function Master 
Plan and potential impact to future capabilities.
    In addition to the space S&T processes discussed above, there are 
additional opportunities to coordinate and collaborate through Air 
Force and Department of Defense (DOD)-level S&T programs as well as 
space management forums such as the Air Force Space Board; the Air 
Force, National Reconnaissance Office (NRO), and National Air and Space 
Administration (NASA) Summit; and the Defense Space Council.

    4. Senator Nelson. General Shelton, what interfaces exist between 
AFRL and AFSPC to provide S&T solutions to the AFSPC S&T needs?
    General Shelton. AFRL routinely interfaces with AFSPC primarily 
through the command's S&T Corporate Process which produces strategic 
investment strategies. The annual process begins with an AFSPC data 
call to all combatant commands, major commands, and selected 
operational units (e.g., National Air and Space Intelligence Center and 
the Joint Space Operations Center). AFSPC uses the responses to 
identify capability gaps and technical needs, which are then 
prioritized based on both the Space Superiority Core Function Master 
Plan and potential impact to future capabilities.
    In addition to the space S&T processes discussed above, there are 
additional opportunities to coordinate and collaborate through Air 
Force and DOD-level S&T programs as well as space management forums 
such as the Air Force Space Board; the Air Force, NRO, and NASA Summit; 
and the Defense Space Council.

                      space based infrared system
    5. Senator Nelson. General Shelton, the first Space Based Infrared 
System (SBIRS) Geosynchronous Earth Orbit (GEO) was launched in May 
2011 with both scanning and staring sensors. The GAO written statement 
states that the ground segment software that is to process the sensor's 
data is not planned to be fully functional until at least 2018. What is 
the plan for processing the sensor data between now and 2018?
    General Shelton. The first SBIRS GEO satellite is undergoing a 
rigorous operational certification process. Preliminary test results 
show the space vehicle is meeting or exceeding performance 
requirements. The staring sensor is undergoing preliminary 
calibrations--at the payload level it is detecting targets 25 percent 
dimmer than expected and the data are being shared with the research 
and development and technical intelligence communities. The DOD funded 
initiatives, separate from the program of record, will deliver interim 
capabilities to process the data from the staring sensor in fiscal year 
2015/2016. The sensor will contribute to the most stressing missile 
warning/missile defense performance requirements with full mission 
operations after acceptance of the final SBIRS Increment 2 ground 
system in fiscal year 2018. While our ground system certification for 
the staring sensor is several years away, we will still take advantage 
of the sensor data with many off-line tools.

                           space test program
    6. Senator Nelson. General Shelton, the Space Test Program (STP) is 
being terminated but the President's budget includes $10 million for 
the program in fiscal year 2013. What will these funds be used for?
    General Shelton. The $10 million allocated for the STP are for 
program support ($0.28 million), launch vehicle and launch services 
($1.74 million), and on-orbit satellite operations ($8.03 million). 
This level of funding is required to complete funded missions and 
execute contract termination liabilities.

    7. Senator Nelson. General Shelton, the Air Force has mentioned 
that the STP-2 mission is a candidate for a new entrant into the 
Evolved Expendable Launch Vehicle (EELV)-class launch arena. How much 
funding is included in the fiscal year 2013 budget request for the 
launch vehicle and satellite for this mission?
    General Shelton. In support of the STP-2 mission, $172 million in 
fiscal year 2012 funds is for purchase of the launch vehicle and $16 
million in fiscal year 2013 funds is for payload integration and 
operations. The manifest for STP-2 is not finalized; therefore, 
satellite costs for this mission are not available.
                                 ______
                                 
              Questions Submitted by Senator Jeff Sessions
                             sequestration
    8. Senator Sessions. Secretary Creedon, Dr. Zangardi, Mr. Winokur, 
General Shelton, Lieutenant General Formica, and Ms. Chaplain, the 
Budget Control Act requires DOD in January 2013 to reduce all major 
accounts over 10 years by a total of $492 billion through 
sequestration. This will result in an immediate $55 billion reduction 
to the fiscal year 2013 defense program. The Secretary of Defense has 
been quoted on numerous occasions that the impact of these cuts would 
be ``devastating'' and ``catastrophic'', leading to a hollow force and 
inflicting serious damage to our national defense. Yet, the Military 
Services must begin this month with some type of guidance on developing 
a Service budget for fiscal year 2014. What are some of the specific 
anticipated implications of sequestration to defense space programs?
    Ms. Creedon. If the sequester is enacted, it will hollow out the 
force. It will lead to a disruption of DOD's investment program which 
would impact defense space programs across-the-board.
    Dr. Zangardi and Mr. Winokur. DOD has not begun planning for 
sequestration with the hopes that Congress will work out a larger 
deficit-reduction plan. Any planning for sequestration would be a 
government-wide effort guided by the Office of Management and Budget 
(OMB). If sequestration occurs, automatic percentage cuts are required 
to be applied without regard to strategy, importance, or priorities.
    General Shelton. OMB has not issued planning guidance; therefore, 
AFSPC has not yet begun detailed planning for sequestration.
    General Formica. The U.S. Army Space and Missile Defense Command/
Army Forces Strategic Command has not received direction from the 
Department of the Army to plan or budget for sequestration. As such, we 
have not assessed the potential impact or altered our fiscal year 2014 
budget plan. However, if sequestration does occur, I expect that the 
implementation would negatively impact our space operations and 
capabilities.
    Ms. Chaplain. We have not done work to project the impact of 
possible sequestration on DOD's projects and activities. Importantly, 
the execution and impact of any spending reductions will depend on the 
legal interpretations and actions taken by OMB. As such, we are not in 
a position to provide you with an informed response. Generally, in 
terms of risks of cuts to the DOD space budget, most of the space-based 
capabilities DOD is pursuing--for example, protected communications, 
missile warning, positioning, navigation, and timing--are critical to 
ongoing military operations.
    We have in the past criticized across-the-board cuts--primarily 
across-the-board rescissions. This approach can result in protecting 
ineffective programs while cutting muscle from high-priority and high-
performing programs. Across-the-board cuts are not substitutes for 
making tough and informed choices about the foundation of government.

    9. Senator Sessions. Secretary Creedon, Dr. Zangardi, Mr. Winokur, 
General Shelton, Lieutenant General Formica, and Ms. Chaplain, what 
programs would have the most significant impact to operations or 
readiness?
    Ms. Creedon. DOD is not planning for the effects of sequestration. 
As OMB has not put out sequestration planning guidance, no planning has 
begun.
    Dr. Zangardi and Mr. Winokur. DOD has not begun planning for 
sequestration with the hopes that Congress will work out a larger 
deficit-reduction plan. Any planning for sequestration would be a 
government-wide effort guided by OMB. If sequestration occurs, 
automatic percentage cuts are required to be applied without regard to 
strategy, importance, or priorities.
    General Shelton. Since sequestration would apply to all programs, 
it will have an impact on Air Force operations and readiness. 
Sequestration also would likely have a negative impact on the space 
industrial base.
    General Formica. Within the U.S. Army Space and Missile Defense 
Command/Army Forces Strategic Command, an assessment has yet to be 
conducted. However, I would expect our operational capabilities to be 
degraded.
    Ms. Chaplain. See answer to question #8.

    10. Senator Sessions. Secretary Creedon, Dr. Zangardi, Mr. Winokur, 
General Shelton, Lieutenant General Formica, and Ms. Chaplain, would 
sequestration lead to contract cancellations, terminations, cost 
increases, or schedule delays?
    Ms. Creedon. DOD is not currently planning for sequestration. OMB 
has not directed agencies, including DOD, to initiate any plans for 
sequestration.
    Dr. Zangardi and Mr. Winokur. DOD has not begun planning for 
sequestration with the hopes that Congress will work out a larger 
deficit-reduction plan. If sequestration happens, automatic percentage 
cuts are required to be applied without regard to strategy, importance, 
or priorities.
    General Shelton. Yes, we anticipate sequestration would force 
program restructures, schedule delays, and reduced procurement 
quantities.
    General Formica. Within the U.S. Army Space and Missile Defense 
Command/Army Forces Strategic Command, we have not been directed by the 
Department of the Army to assess sequestration-caused contract 
cancellations, terminations, cost impacts, or possible schedule delays. 
But, I would expect an impact on our materiel development programs.
    Ms. Chaplain. See answer to question #8.

    11. Senator Sessions. Secretary Creedon, Dr. Zangardi, Mr. Winokur, 
General Shelton, Lieutenant General Formica, and Ms. Chaplain, is DOD 
currently conducting any planning in your areas of responsibility? If 
so, can you describe the plan?
    Ms. Creedon. DOD is not planning for the effects of sequestration. 
As OMB has not put out sequestration planning guidance, no planning has 
begun.
    Dr. Zangardi and Mr. Winokur. DOD has not begun planning for 
sequestration with the hopes that Congress will work out a larger 
deficit-reduction plan. If sequestration happens, automatic percentage 
cuts are required to be applied without regard to strategy, importance, 
or priorities.
    General Shelton. OMB has not issued planning guidance; therefore, 
AFSPC has not yet begun detailed planning for the effects of 
sequestration.
    General Formica. I am not aware of any DOD sequestration planning 
that impacts U.S. Army Space and Missile Defense Command/Army Forces 
Strategic Command assigned space responsibilities.
    Ms. Chaplain. See answer to question #8.

    12. Senator Sessions. Secretary Creedon, Dr. Zangardi, Mr. Winokur, 
General Shelton, Lieutenant General Formica, and Ms. Chaplain, how will 
you assess the risk of each cut?
    Ms. Creedon. Sequestration will lead to disruption of DOD's 
investment programs which would impact DOD programs across-the-board.
    Dr. Zangardi and Mr. Winokur. DOD has not begun planning for 
sequestration with the hopes that Congress will work out a larger 
deficit-reduction plan. If sequestration happens, automatic percentage 
cuts are required to be applied without regard to strategy, importance, 
or priorities.
    General Shelton. If AFSPC is directed to plan for sequestration, we 
will follow the risk assessment methodology provided by the Office of 
the Secretary of Defense in the Defense Planning Guidance and by the 
Air Force in the Air Force Planning and Programming Guidance.
    General Formica. When directed to review programs under 
sequestration, we will assess risk to our ability to provide space 
capabilities to the force. I do expect we would experience a 
degradation in capabilities.
    Ms. Chaplain. See answer to question #8.

    13. Senator Sessions. Secretary Creedon, Dr. Zangardi, Mr. Winokur, 
General Shelton, Lieutenant General Formica, and Ms. Chaplain, has any 
planning commenced to date to assess the impact of such sequestration 
reductions, such as prioritizing programs in preparation for 
reprogramming actions or terminations?
    Ms. Creedon. DOD is not planning for the effects of sequestration. 
As OMB has not put out sequestration planning guidance, no planning has 
begun.
    Dr. Zangardi and Mr. Winokur. DOD has not begun planning for 
sequestration with the hopes that Congress will work out a larger 
deficit-reduction plan. If sequestration happens, automatic percentage 
cuts are required to be applied without regard to strategy, importance, 
or priorities.
    General Shelton. OMB has not issued planning guidance; therefore, 
AFSPC has not yet begun detailed planning for the effects of 
sequestration.
    General Formica. To my knowledge, no sequestration impact planning 
has commenced.
    Ms. Chaplain. See answer to question #8.

            family of advanced beyond line of site terminals
    14. Senator Sessions. General Shelton, the Family of Advanced 
Beyond Line of Site Terminals (FAB-T) has experienced significant 
delays and for the third year in a row, procurement has had to be 
deferred to address development issues. According to GAO, the programs 
software development schedule is still unrealistic and the Air Force 
announced that it would be terminating its FAB-T contract and was going 
to seek alternative providers. How much margin do you have in meeting 
U.S. Strategic Command's (STRATCOM) required delivery date?
    General Shelton. AFSPC is working with the Office of the Secretary 
of Defense, the Joint Staff, and STRATCOM to de-scope the FAB-T 
requirements to support just presidential and national secure 
teleconferencing for ground terminals and airborne platforms such as 
the E-4B and E-6B. We are collectively developing a revised strategy to 
ensure critical warfighters' needs are met.

    15. Senator Sessions. General Shelton, is the Air Force developing 
contingencies in the event FAB-T cannot meet that need date?
    General Shelton. Yes. The Air Force is proceeding with a 
solicitation for a potential alternative source development effort with 
production options for the FAB-T air and ground command post terminals. 
Also, the Advanced Extremely High Frequency system is backward 
compatible with existing Milstar command post terminals.

    16. Senator Sessions. General Shelton and Ms. Chaplain, is it true 
that unless significant savings can be achieved through the 
restructuring, FAB-T is likely to breach Nunn-McCurdy unit cost 
thresholds?
    General Shelton. No. The new acquisition strategy incorporates 
fixed price contracts to limit the risk of cost growth on the program. 
AFSPC is working with the Air Force Cost Analysis Agency and the Office 
of the Secretary of Defense Cost Assessment and Program Evaluation 
(CAPE) to develop ICE. These independent assessments will enable an 
accurate determination of Nunn-McCurdy thresholds.
    Ms. Chaplain. An independent review team noted in October 2010 that 
the FAB-T program would likely breach critical Nunn-McCurdy unit cost 
thresholds; however, a breach has yet to be reported by the program. 
Several factors make it difficult to determine how close the program is 
to breaching the Nunn-McCurdy thresholds. First, the program is 
currently being restructured, to include a revised acquisition 
strategy. Second, a new APB which reflects these changes and their 
projected costs has yet to be approved. And third, while program 
officials stated that a recent ICE showed substantial program cost 
growth, it did not reflect the contents of the new acquisition 
strategy. Until these factors are addressed, it is difficult to know 
whether FAB-T will breach Nunn-McCurdy unit cost thresholds. 
Complicating matters, the FAB-T program plans to convert its current 
cost reimbursement terminal development contract to a firm-fixed-price 
(FFP) contract, negotiate fixed-price production efforts with the 
current contractor, and award a second, competing FFP terminal 
development contract with production options to an alternate source. 
However, the proposals provided by the current contractor reflect 
higher development and production costs and the price of the contract 
with an alternate source is not known at this time. A new ICE is 
expected to be conducted by July 2012 and a revised APB is expected to 
be completed by August 2012.

    17. Senator Sessions. General Shelton and Ms. Chaplain, what is 
being done to address FAB-T affordability and should requirements be 
reexamined?
    General Shelton. AFSPC completed a thorough review of the FAB-T 
requirements and is in the process of briefing the results to the Joint 
Requirements Oversight Council (JROC). This summer, the command will 
request production proposals from the current contractor and from an 
alternative source to validate costs.
    Ms. Chaplain. The FAB-T program has recently undertaken significant 
program restructuring efforts. Although initially directed to terminate 
the existing terminal development contract, the program office was 
redirected to evaluate the possibility of changing the development 
contract type from cost reimbursement to firm-fixed price and 
negotiating fixed-price production efforts with the current contractor. 
In addition, the program office is to complete development of the full 
set of requirements in the current capabilities development document--
both command post terminals and airborne wideband terminals. To lock in 
production prices, the Air Force plans to award a FFP contract for 
terminal production near the beginning of fiscal year 2013, although 
the program of record is not expected to be ready to enter low-rate 
initial production until fiscal year 2014. At the same time, the 
program office plans to award a second FFP contract for terminal 
development, with more limited requirements and capabilities--command 
post terminals only--to an alternate contractor by the end of fiscal 
year 2012. In either case, the Air Force is focusing on delivering a 
presidential national voice conferencing capability in fiscal year 
2015. To assess the deferment of this capability and others, the JROC 
has directed the Air Force to support a Joint Staff functional 
capability board in developing a decision brief outlining the impacts 
of this decision. In fiscal year 2013, the Air Force plans to decide 
whether to continue production with the current or alternate 
contractor, tying knowledge points together for both contractors and 
assessing overall program risk for delivering presidential national 
voice conferencing capability in fiscal year 2015.
    Our work has long shown the need to follow acquisition best 
practices--of achieving a match between requirements and resources in 
programs and of not pursuing overly ambitious and lengthy product 
developments. There must be an early, solid business case with a 
rational balance between requirements, costs, and schedule. Given that 
the current contractor is pursuing development of the full set of 
requirements and the alternate contractor is to develop a more limited 
capability, it is unclear how these solutions can be compared for a 
production decision or how this strategy will provide better value to 
the government.

                         relocation of spectrum
    18. Senator Sessions. Ms. Creedon, in February, Deputy Secretary of 
Defense Lynn sent a letter to Chairman Levin expressing concern with a 
revenue raising proposal to relocate and auction 1755-1780 MHz and 
3550-3650 MHz Federal bands within a 3-year timeframe. According to the 
Deputy Secretary of Defense, setting arbitrary timelines of 3 years 
``contradicts existing law'' and does not provide sufficient time for 
DOD to conduct sufficient analysis and determine cost. Dr. Lynn stated 
that ``a failure to address these concerns could cause significant 
adverse impacts to military training, operations, and combat readiness 
and/or cause DOD to incur unacceptably high implementation costs.'' I 
know you have a lot of experience with this issue from your time on 
this committee. Can you share some of your thoughts on recent proposals 
to relocate national security spectrum?
    Ms. Creedon. In order to make balanced decisions about relocating, 
national security stakeholders require adequate time to conduct 
operational and cost-feasibility analyses to ensure national security 
and other Federal capabilities are preserved, while supporting the 
economic benefits spectrum provides to the Nation. These studies are 
critical to prevent adverse effects on operational capabilities and 
avoid high implementation costs.
    To relocate national security capabilities while maintaining 
mission effectiveness, DOD requires alternate spectrum with comparable 
technical characteristics, cost reimbursement for modifying complex 
weapons systems, and adequate time to make the transition.

    19. Senator Sessions. Secretary Creedon, do you believe existing 
law regarding Federal relocation of spectrum is adequate to ensure that 
DOD will not be unfairly taxed and that warfighters will have access to 
comparable spectrum?
    Ms. Creedon. Section 1062 of the National Defense Authorization Act 
for Fiscal Year 2000, Public Law (PL) 106-65, is very important to 
protecting warfighting capabilities. This statutory requirement is 
intended to ensure DOD is provided access to comparable spectrum, 
certified by the Secretary of Defense, the Chairman of the Joint Chiefs 
of Staff, and the Secretary of Commerce, before surrendering use of any 
given spectrum. Legislation mandating spectrum reallocations and 
auctions without time for certification of alternate spectrum with 
comparable technical characteristics would place PL 106-65 at risk, and 
pose risk to national security operations.

    20. Senator Sessions. Secretary Creedon, recognizing that there are 
compelling interests for increasing spectrum efficiency, do you believe 
there is a need for any additional protections to ensure that DOD is 
not unfairly taxed and that if required to move, DOD will be able to 
recover the cost of doing so?
    Ms. Creedon. Under current statutes, relocation of Federal systems 
to comparable spectrum bands is funded by the proceeds from the 
spectrum auction. These statutes also outline the steps required to 
establish timelines to vacate spectrum. However, in order to make 
balanced decisions about relocating, national security stakeholders 
require adequate time to conduct operational and cost-feasibility 
analyses to ensure national security and other Federal capabilities are 
preserved, while supporting the economic benefits spectrum provides to 
the Nation.

                    precision tracking space system
    21. Senator Sessions. Ms. Chaplain, Missile Defense Agency (MDA) 
programs are also a part of your GAO portfolio. Do you have any 
concerns with MDA's strategy for the Precision Tracking Space System 
(PTSS) or MDA leading the acquisition of a major space system?
    Ms. Chaplain. We issued a report on MDA's Ballistic Missile Defense 
System in April 2012. In this report we note that the new acquisition 
strategy for PTSS is at risk due to concurrency in the development of 
its satellites. While a laboratory-led contractor team is still in the 
development phase of building two development satellites, MDA plans to 
have an industry team develop and produce two engineering and 
manufacturing development satellites. The PTSS program plans then have 
industry compete for the production of the follow-on satellites. While 
the strategy incorporates several important aspects of sound 
acquisition practices, such as competition and short development time 
frames, acquisition risks remain because the industry-built development 
satellites will be under contract and under construction before on-
orbit testing of the lab-built satellites. As such, the strategy may 
not give decisionmakers full benefit from the knowledge to be gained 
about the design and function of the lab-built satellites derived from 
on-orbit testing before making additional major commitments.

    22. Senator Sessions. Ms. Chaplain, while they have yet to conduct 
an ICE, MDA claims PTSS will be low in cost close to the $200 million 
per satellite range. Do you have any confidence in this estimate?
    Ms. Chaplain. In our March 2011 report, we reported that the MDA 
cost estimates we reviewed were not sufficiently credible and did not 
meet the characteristics of high-quality cost estimates based on GAO's 
Cost Estimating and Assessment Guide founded on best practices in cost 
estimating. We also made recommendations that MDA take steps to ensure 
that their cost estimates are high quality, reliable cost estimates 
that are documented to facilitate external review. In follow-on 
meetings with MDA, program officials outlined several steps that MDA 
intended to take to improve the quality of their cost estimates. 
However, in the results of our latest April 2012 review, we have yet to 
see the steps implemented.
    We cannot assess whether the $200 million cost of each PTSS 
satellite is credible or be sure of what costs are included or excluded 
until we have the opportunity to review the cost estimate.
    For example, based on information provided by program officials, 
MDA plans to use a medium EELV to launch two PTSS satellites at one 
time. According to Air Force officials, the cost of launching a medium 
EELV would be about $142 to $179 million, depending on which launch 
vehicle is used and excluding some propellants, transportation, and 
launch capability costs. Without reviewing the PTSS cost estimate, we 
cannot be sure whether launch costs are included in the estimate. In 
addition, as we noted in our 2011 report, one of the criteria for a 
credible cost estimate is having an independent cost assessment. DOD's 
CAPE group is expected to complete its ICE for PTSS the end of fiscal 
year 2012, which will help provide an important independent view of 
PTSS costs.

    23. Senator Sessions. General Shelton, what is the military utility 
of the PTSS?
    General Shelton. AFSPC is engaged in a joint study with MDA to 
understand the full potential of applying the capabilities inherent to 
PTSS to the command's missions. The inherent capabilities may provide 
significant utility to the Space Situational Awareness, Missile 
Warning, and Battlespace Awareness missions.

    24. Senator Sessions. General Shelton, do you believe the 
development and deployment of PTSS should be a priority?
    General Shelton. PTSS, if deployed, will likely be a significant 
contributor to the Nation's missile warning mission, and there is 
potential for PTSS to support the Space Situational Awareness and 
Battlespace Awareness missions through its inherent capability. AFSPC 
and MDA are engaged in a joint study to understand the full potential 
of PTSS to support these missions.

    25. Senator Sessions. General Shelton, given the Air Force 
expertise in space acquisition, do you believe Air Force Space or MDA 
would be best suited for managing this acquisition?
    General Shelton. As the designated lead major command for PTSS, 
AFSPC is engaging with MDA in a hybrid program office which will take 
advantage of the expertise in both organizations. I believe this 
arrangement positions the MDA and AFSPC team for success.

                      mobile user objective system
    26. Senator Sessions. Dr. Zangardi, what is the current status of 
the Navy's Mobile User Objective System (MUOS) program?
    Dr. Zangardi. MUOS-1 launched on February 24, 2012, and the 
manufacturer is currently conducting on-orbit test and checkout of all 
spacecraft systems, which is executing to plan with spacecraft health 
and performance nominal and on schedule to complete in late May 2012. 
The testing includes activation of both the legacy Ultra High Frequency 
(UHF) and the new Wideband Code Division Multiple Access (WCDMA) 
payloads. The Navy will complete its Technical Evaluation in June 2012 
followed by Multi-Service Operational Test and Evaluation (MOT&E), 
which is planned to be complete by late summer 2012. After completion 
of MOT&E, MUOS-1 will be available to support legacy UHF Satellite 
Communications (SATCOM) operations.
    MUOS-2 is assembled, undergoing spacecraft level testing, and on 
track for a November 2012 delivery. The remaining three satellites are 
tracking to cost and schedule with assembly and system level testing of 
MUOS-3 nearly complete. The MUOS Radio Access Facility (RAF) in 
Wahiawa, HI, and the Navy Satellite Operations Center (NAVSOC) at Pt. 
Mugu, CA, are complete. Both sites have the initial software build and 
an interim authority to operate as a standalone system. Both sites are 
being used for on-orbit operations of MUOS-1. The RAFs in Northwest 
(Chesapeake), Virginia; Geraldton, Australia; and Niscemi, Italy, are 
on track for completion by June 2013 to support the launch of MUOS-2 in 
July 2013. The Navy expects the MUOS system to reach Full Operational 
Capability in 2016 and operate as the primary DOD UHF SATCOM system 
through 2026 and beyond.

    27. Senator Sessions. Dr. Zangardi, according to a recent review by 
GAO, new baseline cost estimates for MUOS have not yet been approved. 
When do you plan to have a new acquisition baseline established?
    Dr. Zangardi. The new MUOS APB was signed by the Navy Service 
Acquisition Executive on April 4, 2012. The signed APB has been 
forwarded to the Milestone Decision Authority, the Under Secretary of 
Defense for Acquisition, Technology, and Logistics, for signature.

    28. Senator Sessions. Dr. Zangardi, how likely are we to experience 
a capability gap and what is being done to mitigate the potential for 
gaps in coverage?
    Dr. Zangardi. Navy conducted a statistical analysis of the 
reliability of the UHF Follow-On (UFO) satellite constellation and, 
when combined with the launches of legacy UHF payloads on MUOS 
satellites, determined that DOD legacy UHF SATCOM Chairman Joint Chiefs 
of Staff (CJCS) mandated requirements are projected to be met through 
2018. MUOS satellites were designed to enable a graceful transition 
from legacy UHF SATCOM capability to a revolutionary new SATCOM 
Wideband Code Division Multiple Access capability, which uses cellular 
telephone technology to provide a ten-fold increase in UHF SATCOM 
capacity and throughput to the warfighter.
    To mitigate against unplanned losses of additional UFO satellites, 
Navy has implemented several mitigation activities to extend the 
service life of the existing constellation and increase on-orbit 
capacity. As a result, the current legacy UHF SATCOM provides the 
warfighter with approximately 459 more accesses (111 more channels) 
worldwide than required by the CJCS capacity requirement. This 
additional capacity is equivalent to three UFO satellites and provides 
a buffer against unplanned losses in the future. Additionally, each 
MUOS satellite carries a legacy UHF SATCOM payload that provides 
capacity equivalent to that provided by one UFO satellite. Commander, 
STRATCOM, recently signed out a letter to the DOD Chief Information 
Officer confirming their position that the MUOS legacy UHF payloads 
were added to the MUOS satellites as one of many UFO resiliency 
measures.

    [Whereupon, at 4:25 p.m., the subcommittee adjourned.]


DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 
               2013 AND THE FUTURE YEARS DEFENSE PROGRAM

                              ----------                              


                       WEDNESDAY, MARCH 28, 2012

                               U.S. Senate,
                  Subcommittee on Strategic Forces,
                               Committee on Armed Services,
                                                    Washington, DC.

           DEPARTMENT OF DEFENSE NUCLEAR FORCES AND POLICIES

    The subcommittee met, pursuant to notice, at 2:29 p.m. in 
room SR-222, Russell Senate Office Building, Senator E. 
Benjamin Nelson (chairman of the subcommittee) presiding.
    Committee members present: Senators Nelson, Reed, Sessions, 
and Cornyn.
    Majority staff member present: Jonathan S. Epstein, 
counsel.
    Minority staff member present: Daniel A. Lerner, 
professional staff member.
    Staff assistant present: Hannah I. Lloyd.
    Committee members' assistants present: Carolyn Chuhta, 
assistant to Senator Reed; Ryan Ehly, assistant to Senator 
Nelson; Lenwood Landrum, assistant to Senator Sessions; and 
Dave Hanke and Grace Smitham, assistants to Senator Cornyn.

   OPENING STATEMENT OF SENATOR E. BENJAMIN NELSON, CHAIRMAN

    Senator Nelson. Let me bring today's hearing to order. This 
hearing will receive testimony from the Department of Defense 
(DOD) as it pertains to nuclear matters for fiscal year 2013. 
First, I want to thank all of our witnesses for being here 
today. I know taking time from your schedule is not the easiest 
thing to do, but we appreciate very much your doing that.
    We're going to have a closed session on the Long-Range 
Strike Bomber program. It will be in Senate Security, room SVC-
217, and to accommodate the closed session we'll try to wrap up 
by 3:30 p.m. here; and after Senator Sessions and I give some 
brief comments we thought it might be best to just go straight 
to some questions.
    But before I begin, I have a letter to Senator Sessions and 
to me from eight of our fellow Senators supporting sustainment 
for our Intercontinental Ballistic Missiles (ICBM), that I ask 
consent to enter into the record. I think you may have a copy 
of the letter as well. Without objection, it will be.
    Senator Sessions. No objection.
    [The information referred to follows:]
      
    
    
      
    
    
      
    
    
      
    Senator Nelson. Also with that, let me make just a couple 
of short comments before I turn it over to Senator Sessions for 
some comments as well. The 1251 report was revised in section 
1043 of the National Defense Authorization Act (NDAA) for 
Fiscal Year 2012 to include additional data and make it part of 
the President's annual budget submission.
    I have a letter to Chairman Levin, dated March 2, 2012, 
signed by Secretaries Chu and Panetta, that states that they 
can't submit a unified DOD-Department of Energy (DOE) 10-year 
plan. Instead, DOD will submit its 10-year plan ``in the coming 
weeks''; and then ``over the next several months'' DOD and DOE 
will submit a plan consistent with the spending levels of the 
Budget Control Act.
    I ask that this letter be entered into the record as well.
    Senator Sessions. No objection.
    [The information referred to follows:]
      
    
    
      
    
    
      
    
    
      
    Senator Nelson. Congress is now left without the long-term 
data to determine whether we are making the investments to 
ensure our DOD delivery platforms and DOD infrastructure are on 
a sustained path for modernization. I'm hopeful that Assistant 
Secretaries Creedon and Weber can explain what happened and 
when Congress might see the funding data requested in section 
1043.
    The W76 warhead refurbishment was decremented some $80 
million in the National Nuclear Security Administration (NNSA) 
budget to help cover cost increases for the B61 refurbishment. 
Of course, Admiral Benedict, we want to know, does that affect 
our posture? Also, how does the 2-year delay in the Ohio 
replacement submarine affect your program?
    The B-52 fleet is not getting the Combat Network 
Communications Technology (CONECT) system upgrade to overhaul 
its aging analog controls and help it retarget. General 
Kowalski, can you help explain the implications on our force 
posture?
    The B-2 and B-52 are not getting terminals to communicate 
with the Advanced Extremely High Frequency (AEHF) satellite for 
nuclear command and control. This was a U.S. Strategic Command 
(STRATCOM) requirement. So, General Chambers, I guess we ask 
what is the fix and will it suffice over the long haul?
    NNSA has decided to defer the Chemistry and Metallurgy 
Research Replacement (CMRR) facility at Los Alamos to help 
store and test plutonium. The laboratory director has flatly 
stated he cannot meet DOD's 50 to 80 pit requirement for the 
W78 warhead life extension. So, Secretary Weber, can you help 
us explain its impacts to DOD readiness? I hope you're not 
going to change the 50 to 80 pit requirement to meet the NNSA 
decision, which might be one of the options that could be 
looked at.
    Finally, Secretary Creedon has had more time before this 
committee than almost anybody else here recently. To my 
knowledge, Congress has yet to see any changes to the nuclear 
force structure as a result of the New Strategic Arms Reduction 
Treaty (New START). We thought that was coming in the fiscal 
year 2013 budget, but we haven't heard anything about that, and 
hopefully you will be able to help us with that.
    Now, having said all those things, there's still more to be 
said, I'm sure. So I'm turning to my good friend and co-chair, 
Senator Sessions, for any comments that he might wish to give.

               STATEMENT OF SENATOR JEFF SESSIONS

    Senator Sessions. Thank you, Mr. Chairman. It's been such a 
great pleasure to work with you. Maybe this will be our last 
one together.
    Senator Nelson. Maybe.
    Senator Sessions. Last markup, but not the last roundup, 
for Senator Nelson.
    The purpose of today's hearing is to assess the fiscal year 
2013 request for the sustainment and modernization of the triad 
of nuclear delivery vehicles. Unlike NNSA's budget, I applaud 
DOD. You have done a good job of maintaining a clear commitment 
to modernization despite tough budget times.
    While the DOD budget is not immune to cuts, the key 
elements of the plan appear to be intact. Risk will increase 
with this budget and, while I have not yet concluded whether 
all of these risks are acceptable, I look forward to hearing 
from the witnesses why they believe the increased risk and the 
possibility of not meeting future STRATCOM requirements is 
manageable.
    The sustainment and modernization of the triad will not be 
cheap and will require long-term sustained commitments spanning 
future Congresses and administrations. Last year the cost for 
just 10 years was projected to be over $120 billion. While the 
most recent estimate has not yet been provided, I am unaware of 
any major changes in the plan that would significantly alter 
that.
    Nevertheless, our next generation nuclear capabilities must 
be affordable and every effort must be made to ensure each 
dollar is spent wisely. A robust triad of nuclear delivery 
vehicles is essential and I believe that uncontrollable costs 
perhaps more than anything else could be a threat to our 
ensuring it in the future. I think that's what Admiral Mullen 
meant when he said the greatest threat to our national security 
is our deficit, because the numbers are so bad and so serious 
that it's forcing cuts in areas that we would rather not.
    Mr. Chairman, I will just briefly conclude and note that we 
have much to do. I would offer my remarks for the record, and I 
look forward to hearing from the witnesses. I believe that DOD 
has every right to be deeply engaged in the production of the 
weapons you will use, and I think we need transparency on the 
producing side and we need influence and leadership from the 
consumer side.
    Thank you, Mr. Chairman.
    [The prepared statement of Senator Sessions follows:]
              Prepared Statement by Senator Jeff Sessions
    Thank you very much, Mr. Chairman, I join you in welcoming our 
distinguished panel of witnesses. We have a number of witnesses and 
plan to move to a closed session, so in the interest of time I will 
keep my remarks brief.
    The purpose of today's hearing is to assess the fiscal year 2013 
request for the sustainment and modernization of the triad of nuclear 
delivery vehicles. Unlike the National Nuclear Security Administration 
budget, I applaud the Department of Defense (DOD) for maintaining its 
commitment to modernization. While the DOD budget was not immune to 
cuts, the key elements of the plan appear to remain intact. Risk will 
increase with this budget and while I have not yet concluded whether 
all of these increased risks are acceptable, I look forward to hearing 
from our witnesses why they believe the increased risk and the 
possibility of not meeting future U.S. Strategic Command requirements 
is manageable.
    The sustainment and modernization of the triad will not be cheap 
and will require a long-term sustained commitment spanning future 
Congresses and administrations. Last year the cost of just the next 10 
years was projected to be over $120 billion and while the most recent 
estimate has not yet been provided, I am unaware of any major changes 
to the plan that would significantly alter that funding requirement. 
Nevertheless, our next-generation nuclear capabilities must be 
affordable and every effort must be made to ensure that each dollar is 
being spent wisely. A robust triad of nuclear delivery vehicles is 
essential and I believe that uncontrollable cost more than anything 
else is the greatest threat to ensuring its future. I look forward to 
better understanding the steps each of you are taking to insist that 
your programs are delivered on time and within cost.
    Section 1043 of the National Defense Authorization Act for Fiscal 
Year 2012 requires the President each year to provide Congress with a 
report and 10-year funding requirement for nuclear modernization 
efforts at both DOD and the Department of Energy (DOE). This report 
which replaces the old 1251 report is intended to ensure that strategy 
and budgets are aligned. While we learned just a few weeks ago how 
fungible DOE views the modernization strategy, I hope the same is not 
true for DOD and I look forward to hearing from our witnesses when the 
administration intends to provide the 1043 report to Congress.
    DOD, at the direction of the White House, recently completed a 90-
day study to look at force posture in support of a follow-on arms 
control agreement. I happen to agree with a recent assessment by John 
Bolton, that ``Instead of dealing with real nuclear threats like Iran 
and North Korea, [the President is] going to magic shows and talking 
about a world without nuclear weapons, which would be a much less safe 
world for the United States.'' This administration has already undercut 
its commitment to modernizing the nuclear weapons complex which was a 
prerequisite for considering additional reductions. For the President 
to even consider additional reductions in a fiscal environment that he 
has concluded is not suitable for making the necessary infrastructure 
investments is irresponsible and counter to our national security 
interests. I look forward to hearing from our witnesses what was 
considered in the 90-day study and if they believe additional 
reductions would be feasible without the modernization efforts that 
experts have unanimously recognized as critical to the future viability 
of the weapons complex at any level.
    I thank the witnesses for joining us today and look forward to 
their testimony.

    Senator Nelson. Thank you, Senator Sessions.
    Let me first start with Secretary Creedon. Number one, the 
New START force structure. Can you tell us when we can expect 
to see the nuclear force structure sent to Congress from the 
New START treaty? Do you have a timeframe?

 STATEMENT OF HON. MADELYN R. CREEDON, ASSISTANT SECRETARY OF 
              DEFENSE FOR GLOBAL STRATEGIC AFFAIRS

    Ms. Creedon. Sir, the central limits of the New START 
treaty have to be met within 7 years from entry into the force, 
which occurred in February 2011. So at the outset, DOD and the 
Services are focused on getting rid of those assets that would 
count under the treaty, but are, as we refer to them, phantoms. 
In other words, they're previously retired and can be retired 
now without any initial impact on the actual active forces.
    So this would include 50 previously retired Peacekeeper 
silos, 50 previously retired Minuteman III silos, and B-52H 
bombers that are at Davis-Monthan. So that's the initial focus, 
addressing these phantoms, systems that are no longer in active 
service.
    After that, then we'll move on to what the active 
reductions will be. The assumption at the moment is that the 
active reduction decisions will be made at the end of the year, 
but in the context of the fiscal year 2014 budget.
    [The prepared joint statement of Ms. Creedon and Mr. Weber 
follows:]
        Prepared Joint Statement by Hon. Madelyn R. Creedon and 
                          Hon. Andrew C. Weber
                              introduction
    Chairman Nelson, Ranking Member Sessions, and members of the 
subcommittee, we are pleased to have the opportunity to join Lieutenant 
General Kowalski, Major General Chambers, and Rear Admiral Benedict in 
discussing a critical topic--U.S. nuclear forces and policy.
    This statement constitutes the combined testimony of our 
organizations--the Office of the Assistant Secretary of Defense (ASD) 
for Global Strategic Affairs (GSA) in the Office of the Under Secretary 
of Defense for Policy and the Office of the ASD for Nuclear, Chemical, 
and Biological Defense Programs (NCB) in the Office of the Under 
Secretary of Defense for Acquisition, Technology, and Logistics (AT&L).
    Our offices are responsible for policy development, acquisition 
management, and oversight for nuclear weapons for the Office of the 
Secretary of Defense. As the ASDs for GSA and NCB, we also serve as the 
advisor and executive secretary, respectively, to the Nuclear Weapons 
Council (NWC) on all areas dealing with nuclear deterrence.
    GSA is responsible for policy development in a number of areas, 
including: nuclear deterrence; countering the proliferation of weapons 
of mass destruction; strategies for defending against the threat of 
ballistic missiles; and addressing the emerging challenges the Nation 
faces in the cyber and space domains. GSA leads the Department of 
Defense's (DOD) efforts to execute the President's vision to take 
concrete steps toward a world without nuclear weapons while maintaining 
a safe, secure, and effective nuclear deterrent for the Nation. We also 
lead DOD's work with U.S. Government departments and agencies and our 
international partners to strengthen deterrence around the world.
    NCB plays a key role in managing the U.S. nuclear deterrent and 
leading DOD's efforts to acquire the warheads for nuclear systems in 
order to meet the operational needs of our Armed Forces. Two of the 
ASD(NCB)'s main responsibilities are the missions of providing the 
United States and its allies with a safe, secure, and effective nuclear 
deterrent capability and determining the nuclear survivability of U.S. 
military forces. In addition to these missions, NCB leads DOD's efforts 
to counter nuclear terrorism through activities such as the 4-year 
initiative to secure all vulnerable nuclear materials worldwide, the 
Nuclear Security Summit, and the Global Initiative to Combat Nuclear 
Terrorism.
    As the January 2012 DOD strategic guidance makes clear, the United 
States will field nuclear forces that can--under any circumstances--
confront an adversary with the prospect of unacceptable damage, both to 
deter potential adversaries and to assure U.S. allies and security 
partners that they can count on the United States' commitment to our 
shared security.
    Today, we would like to touch on several topics: the global nuclear 
balance; our implementation of the New START treaty and its 
implications for U.S. nuclear forces and policy; our work to strengthen 
regional deterrence and assurance for our allies and partners; work 
underway to ensure a future nuclear force structure in line with the 
President's vision; the important role the budget will play in meeting 
this vision; efforts that DOD and the NWC are undertaking to ensure 
that we have the forces we require for the foreseeable future, 
including revitalizing the nuclear infrastructure, meeting DOD 
stockpile requirements, and modernizing delivery systems and command 
and control; nuclear physical security; and international efforts to 
counter nuclear threats.
                       the global nuclear balance
    Let us first set the scene by discussing the nuclear arsenals 
around the world. In September 2009, the Obama administration publicly 
stated that the U.S. nuclear arsenal included 5,113 weapons, not 
including weapons awaiting dismantlement. That arsenal, although 
sizeable, has shrunk significantly from a high point of approximately 
31,000 warheads in 1967.
    Russia has approximately 4,000 to 6,500 nuclear weapons, according 
to unclassified estimates, of which approximately 2,000 to 4,000 are 
non-strategic--or ``tactical''--nuclear weapons. Russian strategic 
nuclear warheads are reported under the New START treaty, and the 
limits on its deployed strategic nuclear weapons are monitored through 
onsite inspections, but we lack confidence in estimates of Russian 
tactical nuclear weapons.
    Russia maintains a robust nuclear warhead production capability to 
remanufacture warheads regularly rather than conduct Life Extension 
Programs (LEP). Russia is also working to modernize delivery systems, 
including a mobile variant of the Topol intercontinental ballistic 
missile (ICBM) and new Borey-class missile submarines with Bulava 
submarine-launched ballistic missiles (SLBM). Under the New START 
treaty, Russian forces will be limited to 800 total and 700 deployed 
strategic delivery systems. Russia will also be limited to 1,550 
deployed strategic warheads to comply with the central limits of the 
New START treaty.
    We do not have arms control insight into China's nuclear 
capabilities. China appears to be increasing the size of its nuclear 
arsenal, which today consists of a few hundred nuclear weapons. We know 
that China has a broad range of missile-development programs, including 
an effort to replace some liquid-fueled systems with more advanced 
solid-fueled systems. China is also pursuing a sea-based deterrent with 
the construction of the Jin-class submarine.
    Of course, the list of the world's declared nuclear powers includes 
two of our North Atlantic Treaty Organization (NATO) allies. The United 
Kingdom and France each have a few hundred nuclear weapons. France is 
upgrading its nuclear capabilities by replacing legacy delivery 
aircraft with the Rafale and by fielding the new M51 SLBM. The United 
Kingdom is focused on replacing its Vanguard-class strategic ballistic 
missile submarines and is collaborating with the United States on a new 
common missile compartment to be used on both the Vanguard-class and 
the U.S. Ohio-class replacement submarine.
    In recent years, the situation has grown more complicated as other 
states seek nuclear weapons of their own or enhance their existing 
nuclear arsenals. Today, India and Pakistan are each estimated to have 
fewer weapons than China, but they are increasing the size of their 
nuclear arsenals. Pakistan is expanding its plutonium production 
capabilities, and both India and Pakistan are seeking advanced delivery 
systems. In addition, North Korea has tested a plutonium-based weapon 
design and claims to be enriching uranium. Based on recent events, it 
is possible that the downward trend of recent years may be reversing 
with respect to North Korea. However, in the absence of full 
transparency and cooperation with the International Atomic Energy 
Agency, we remain concerned about Pyongyang's ultimate intentions. 
Likewise, we are profoundly troubled by Tehran's nuclear ambitions and 
its unwillingness to meet its international nonproliferation 
obligations.
    This complex global security environment is the context in which 
our future force structure decisions must be made.
                 implementation of the new start treaty
    One very important step toward addressing the security environment 
we face, given that the United States and Russia continue to have the 
vast majority of the world's nuclear weapons, was the entry into force 
of the New START treaty in February 2011.
    President Obama made the decision to expedite negotiations for the 
New START treaty in order to reinvigorate arms control and to minimize 
the lapse in verification measures occasioned by the expiration of the 
START treaty. This decision was consistent with the recommendations of 
the Congressional Commission on the Strategic Posture of the United 
States, which called for an initial agreement with Russia to ensure 
that a verification program would be in place after the START treaty 
expired, followed by negotiations on potential further reductions.
    Implementation of the New START treaty is fully underway. From 
February 5, 2011 to February 5, 2012, the United States and Russia 
conducted 18 onsite inspections, which is the maximum number allowed 
under the New START treaty. The Defense Threat Reduction Agency 
conducts these inspections, and the organization's extensive experience 
with onsite inspections ensures the maximum value of this exercise. The 
two countries have also exchanged roughly 1,800 notifications regarding 
nuclear weapons dispositions, deployments, and repairs since the New 
START treaty entered into force. This represents a 28 percent increase 
above the predecessor START treaty over a comparable period. These 
exchanges and inspections provide transparency that is crucial to 
fostering mutual trust between the two countries. Additionally, 
delegations of both sides have already met three times under the New 
START treaty's Bilateral Consultative Commission to discuss 
implementation issues.
    We are on track to meet the 2018 deadline for the central limits of 
1,550 warheads on deployed ICBMs, deployed SLBMs, and accountable 
nuclear warheads for deployed heavy bombers; 700 deployed ICBMs, 
deployed SLBMs, and deployed heavy bombers; and 800 deployed and non-
deployed launchers and bombers--thresholds that, based on careful 
analysis, are adequate to meet U.S. national security requirements.
    The New START treaty is the first step in the Obama 
administration's vision for further reductions in strategic and non-
strategic nuclear weapons. The timing and framework for the next round 
of arms control negotiations have not been set, but new discussions 
with Russia will need to be broader in scope and more ambitious. The 
President has made clear that the next phase should include the total 
arsenal of nuclear weapons: deployed and non-deployed, strategic and 
non-strategic. To that end, we fully support the Senate's condition in 
its New START treaty Resolution of Advice and Consent to Ratification 
to pursue an agreement with Russia that would address the disparity 
between the tactical nuclear weapons stockpiles of the Russian 
Federation and of the United States and would secure and reduce 
tactical nuclear weapons in a verifiable manner. As the 2010 Nuclear 
Posture Review (NPR) states, Russia's nuclear forces will remain a 
significant factor in determining how much and how fast we are prepared 
to reduce U.S. forces. Strict numerical parity in nuclear weapons 
between the two countries is no longer as compelling as it was during 
the Cold War. However, large disparities in nuclear capabilities could 
raise concerns on both sides, as well as among U.S. allies and 
partners, and may not be conducive to maintaining a stable, long-term 
strategic relationship. Therefore, we would emphasize the importance of 
Russia joining us as we move to lower levels of nuclear forces.
    We continue to pursue high-level, bilateral dialogues with both 
Russia and China that are aimed at promoting stable, resilient, and 
transparent strategic relationships. The United States took a bold step 
toward transparency by making public the number of nuclear weapons in 
the U.S. stockpile. We would welcome reciprocal declarations by Russia 
and China.
            strengthening regional deterrence and assurance
    The United States remains committed to our allies' continuing 
security through our policy of extended deterrence. We seek to 
reiterate this message as often as possible, including through efforts 
to bolster regional deterrence architectures around the world. We are 
building regional cooperative missile defenses, forward-deploying U.S. 
forces, and maintaining what is commonly referred to as the ``nuclear 
umbrella.'' The Obama administration will uphold U.S. security 
commitments to our allies.
    We would like to touch briefly on deterrence issues in three 
regions, starting with the Asia-Pacific region. As DOD's new strategic 
guidance makes clear, this region is being accorded increased 
importance, and we are strengthening our security partnerships there. 
In 2010, for example, we added new forums to our already robust 
relationships to enhance extended deterrence in Northeast Asia--the 
Extended Deterrence Policy Committee with the Republic of Korea and the 
Extended Deterrence Dialogue with Japan.
    Japan is also a strong partner in ballistic missile defenses, 
successfully developing its own layered capabilities and co-developing 
an advanced version of the SM-3 interceptor, the SM-3 Block IIA. We 
regularly train together, learn from each other, and conduct 
cooperative missile defense exercises. In addition, the United States 
is consulting with the Republic of Korea and Australia about 
possibilities for missile defense cooperation.
    Another priority region for DOD is the Middle East. For the United 
States, the Arab Awakening and the withdrawal of U.S. military forces 
from Iraq present new strategic opportunities and new challenges. 
Developments stemming from the Arab Awakening provide an opportunity to 
support governments that are responsive to the aspirations of their 
people. At the same time, we remain unrelenting in our commitment to 
counter the proliferation of ballistic missiles and weapons of mass 
destruction. The United States is nurturing longstanding relationships 
and expanding new ones to prevent Iran's development of a nuclear 
weapon capability and to counter destabilizing policies in the region.
    Israel and the United States coordinate and cooperate extensively 
on missile defense. We have a long history of cooperation on plans and 
operations, combined exercises, and combined research and development 
programs. The United States maintains a constant missile defense 
presence in the Persian Gulf region, and we are working with a number 
of Gulf Cooperation Council members--Bahrain, Kuwait, Oman, Qatar, 
Saudi Arabia, and the United Arab Emirates (UAE)--on missile defense, 
including the purchase of U.S. capabilities. The UAE, for example, 
recently announced its plan to purchase Terminal High Altitude Area 
Defense (THAAD) and Patriot systems from the United States.
    DOD's strategic guidance also makes clear that ``Europe is our 
principal partner in seeking global and economic security, and will 
remain so for the foreseeable future.'' The guidance affirms the 
critical importance of NATO, as President Obama did in November 2010 
when he invited his fellow heads of state and government to Chicago for 
the first NATO Summit in the United States in 13 years. This came on 
the heels of the Lisbon Summit, which made real progress in 
strengthening our ties as allies through the approval of a new 
Strategic Concept for the Alliance and through NATO's adoption of 
territorial missile defense as an Alliance mission. Allies at Lisbon 
also agreed to undertake a Deterrence and Defense Posture Review (DDPR) 
to determine the appropriate mix of nuclear, conventional, and missile 
defense forces that NATO will need to deter and defend against threats 
to the alliance. This review will consider how arms control, 
disarmament and nonproliferation could promote alliance security.
    Guided by the Strategic Concept, allies are working to complete the 
DDPR by the time of the NATO Summit in Chicago in May 2012. The primary 
aim of the DDPR is to determine the appropriate mix of nuclear, 
conventional, and missile defense forces that NATO will need to deter 
and defend against threats to the alliance, and to ensure its members' 
security. The drafting of the DDPR is proceeding in accordance with the 
premises that continue to be central to NATO's nuclear posture, 
particularly the basic principles reaffirmed by the United States in 
the 2010 NPR that any changes in NATO's nuclear posture will be taken 
only after a thorough review within--and decision by--the Alliance as a 
whole.
                a nuclear force structure for the future
    As part of the NPR, the President called for follow-on analysis to 
set a goal for future nuclear reductions below New START levels while 
strengthening deterrence of potential regional adversaries, enhancing 
strategic stability vis-a-vis Russia and China, and assuring our allies 
and partners. Even as we consider future reductions, the President has 
made clear that the entire administration remains committed to 
retaining a safe, secure, and effective nuclear arsenal for as long as 
nuclear weapons exist.
    The administration's review of nuclear guidance in light of the 
current and expected future security environment is making good on the 
President's commitment, and it is consistent with how past Presidents 
have managed their responsibilities as Commander in Chief. We want to 
underscore that this process is not a re-evaluation of the NPR, but 
that it is a key part of its implementation.
    The study is not revisiting the first principles outlined in the 
NPR. Indeed, in undertaking this effort, we are focused on achieving 
the NPR's five strategic objectives: preventing nuclear proliferation 
and nuclear terrorism; reducing the role of U.S. nuclear weapons in 
U.S. national security strategy; maintaining strategic deterrence and 
stability at reduced nuclear force levels; strengthening regional 
deterrence and reassuring U.S. allies and partners; and sustaining a 
safe, secure, and effective nuclear arsenal. These are the standards by 
which we will assess deterrence requirements.
    Our analysis is also considering the critical question of what to 
do if deterrence fails. In effect, we are asking: What are the guiding 
concepts for employing nuclear weapons to deter adversaries, and what 
are the guiding concepts for ending a nuclear conflict on the least 
catastrophic terms if one has already started?
    The Office of the Secretary of Defense is working closely with the 
Joint Staff and U.S. Strategic Command (STRATCOM) in conducting this 
analysis. We are closely coordinating with the National Security Staff 
and senior representatives from the Departments of Energy and State. 
The results are intended to inform the President's guidance to DOD on 
nuclear planning and to shape the force structure needed to protect the 
United States, its allies, and its partners.
                                 budget
    The budget, of course, influences our plans looking forward. The 
current fiscal situation is putting pressure on the entire DOD, and the 
nuclear enterprise is no exception.
    For fiscal year 2013, we have made careful choices to protect high-
priority programs while allowing some efforts to be delayed with 
acceptable or manageable risk. Some programs, including the replacement 
for the Ohio-class ballistic missile submarine, will be delayed. 
Others, such as a new bomber, will remain on schedule. As we look to 
sustain the current triad and develop the appropriate force mix, cost 
efficiencies must be factored into the sequencing of our upgrade 
efforts.
    Ensuring that our nuclear forces are properly sized and configured 
to face real threats, both today and in the future, is a responsibility 
this administration takes very seriously. The Obama administration 
continues to believe that maintaining a nuclear triad is essential to 
U.S. national security.
    The budget request protects investments in homeland missile 
defense, and we will continue to develop our regional missile defense 
capabilities, although at a somewhat slower rate.
    In this budget, we will also continue to fund the development of 
conventional strike capabilities, another important part of deterrence. 
The DOD budget includes a Defense-wide technology development program 
on Conventional Prompt Global Strike (CPGS), the objective of which is 
to develop and demonstrate boost-glide CPGS technologies and test 
capabilities. CPGS would provide the President with a wider range of 
options to engage targets at strategic ranges in less than an hour, a 
capability that has previously only been available with nuclear-armed 
strategic missiles. DOD has no current plans to replace nuclear 
warheads on our Minuteman ICBMs or Trident SLBMs with conventional 
warheads.
    It is worth bearing in mind that some of the most important 
initiatives detailed in the NPR do not require any additional funding. 
These include support to the Nuclear Nonproliferation Treaty, pursuing 
future arms control negotiations, and reducing the role of nuclear 
weapons in national strategy. Such efforts continue apace.
                revitalizing the nuclear infrastructure
    Despite an overall declining top line for DOD, the President's 
fiscal year 2013 budget request makes the investments necessary for DOD 
to meet its deterrence requirements. To do so, these investments must 
span the nuclear enterprise, including the infrastructure that provides 
agile research and development and manufacturing capabilities upon 
which an effective strategic deterrent relies.
    DOD and the Department of Energy (DOE) are committed to a shared 
approach to recapitalizing the Nation's nuclear infrastructure in a 
responsible, fiscally prudent way. The NPR states that the physical 
infrastructure supporting the nuclear weapons complex ``has fallen into 
neglect'' and that increased investments in the nuclear infrastructure 
are ``needed to ensure the long-term safety, security, and 
effectiveness of our nuclear arsenal and to support the full range of 
nuclear security work to include nonproliferation, nuclear forensics, 
nuclear counterterrorism, emergency management, intelligence analysis 
and treaty verification.'' The NPR also emphasizes that the human 
capital of the nuclear enterprise has been ``underfunded and 
underdeveloped.'' It is clear that reversing these trends and 
accomplishing this revitalization will require significant investment 
over a sustained period of time.
    Fiscal year 2013 funding levels in the President's budget will 
allow us to work with DOE in continuing our efforts to restore the 
health of the intellectual infrastructure that our national 
laboratories provide. The scientific and technological base at our 
nuclear weapons laboratories forms the backbone of our deterrent. As 
the 2010 NPR states, rehabilitation and modernization in the nuclear 
weapons infrastructure would allow the United States to ``shift away 
from retaining large numbers of non-deployed warheads as a hedge 
against technical failure, allowing major reductions in the nuclear 
stockpile.''
    DOD has agreed to transfer approximately $8.2 billion to the 
National Nuclear Security Administration (NNSA) during fiscal year 
2011-2016. This funding will help ensure that we can successfully 
extend the life of our current weapons and modernize the supporting 
infrastructure. In addition, we are currently working with NNSA on a 
budget issue team to review joint priorities for support of the nuclear 
deterrent and to ensure that we are fully aligned for fiscal year 2014 
and beyond. We expect the issue team's results later this year.
    The aging of the nuclear weapons physical infrastructure presents 
significant challenges for ensuring that the capabilities needed to 
support the nuclear deterrent are maintained over the long term. To 
address these obstacles, construction of the Uranium Processing 
Facility (UPF) has been accelerated to ensure that current uranium 
processing capabilities are not jeopardized.
    Building a large, one-of-a-kind nuclear facility such as the UPF, 
presents substantial planning, design, and development challenges. 
Indeed, the estimated costs for the UPF have grown substantially, 
raising concerns about the affordability of the project. Particularly 
in today's fiscally constrained environment, the NWC is prioritizing 
efforts to control costs.
    DOD has worked closely with NNSA in the last year, and will 
continue to do so, to ensure that necessary plutonium capabilities are 
available to meet future projected requirements.
    Finally, crucial to continued certification of the nuclear arsenal 
is a robust weapon surveillance program that provides sufficient 
information for NNSA laboratories to assess the state-of-health of the 
weapons. NNSA has increased its surveillance funding and reduced test 
backlogs. With improved science tools, such as advanced computers and 
new experimental facilities, the national laboratories have increased 
their capability to understand and resolve stockpile issues. DOD will 
continue to support these efforts, for example, by providing sufficient 
flight test assets.
    Beyond their national deterrent mission, the national laboratories 
contribute greatly to our efforts in nonproliferation and WMD 
counterterrorism. They have become ``dual-use'' nuclear security 
research and development organizations that provide considerable 
leverage to enhance all aspects of global security. Prioritizing these 
important missions among U.S. national security objectives and 
supporting the laboratories with sufficient resources are mandatory for 
recruiting, training, and retaining a talented workforce.
                       dod stockpile requirements
    Today, the U.S. nuclear weapon stockpile is the smallest it has 
been since the Eisenhower administration. All three nuclear weapons 
laboratory directors and Commander, STRATCOM, assess the stockpile 
annually. The most recent assessment found that the stockpile is safe, 
secure, and effective and that there is no need to conduct explosive 
nuclear testing.
    Looking to the future of the nuclear arsenal, DOD and DOE will 
continue several weapon-system LEPs in fiscal year 2013 to support 
long-term deterrence capabilities. Among the near-term efforts, DOE 
will continue the B61 and W76 LEPs. Given fiscal challenges, the NWC 
agreed to extend the duration of the LEPs, enabling DOD to meet 
deterrence requirements effectively while more efficiently managing 
annual costs among multiple programs.
    Other ballistic missile warheads are also nearing end-of-life. DOD 
and DOE are conducting a W78/W88 common warhead study to examine a 
warhead option that could be deployed with both ICBMs and SLBMs. To 
leverage this effort, DOE, the Air Force, and the Navy are jointly 
developing a modern Arming, Fuzing, and Firing system, initially for 
the W88 SLBM warhead but also adaptable for use in a potential W78/W88 
common warhead.
    Efforts to develop a common warhead for deployment on multiple 
platforms would allow DOD to reduce the number of warhead types in the 
stockpile and the number of warheads needed to maintain the nuclear 
deterrent should a failure occur with a delivery platform or warhead. 
Warhead commonality would also allow for substantial reductions in 
life-cycle and production costs.
    Life extension of the B61 gravity bomb is needed for support to the 
bomber leg of the triad and to provide U.S. extended deterrence to our 
allies. The NPR reaffirms both the extended and strategic deterrent 
roles of the B61 and affirmed its full-scope life extension. The result 
will be the B61 mod 12 bomb, which will replace four of the five B61 
variants (mods -3,-4,-7, and -10), further promoting efficiencies and 
lowering costs.
         delivery systems and command and control modernization
    DOD will continue to modernize programs for the delivery systems 
that underpin nuclear deterrence. The NPR's conclusion to retain a 
nuclear triad of ICBMs, SLBMs, and nuclear-capable heavy bombers is 
premised on maintaining these delivery systems, and the President's 
fiscal year 2013 budget reflects this approach.
    Sustaining the sea-based, and most survivable, leg of our nuclear 
deterrent is particularly vital as we move to lower numbers under the 
New START treaty. To ensure the continued health of this critical 
capability, the service lives of our Trident D-5 missiles are being 
extended to 2042, and construction of the first of the Ohio-class 
replacement submarines is scheduled to begin in 2021. As mentioned, 
this represents a 2-year slip compared with last year's plan. However, 
the Navy believes it can manage the challenges resulting from the 
delay: specifically, that the first Ohio-class SSBNs would reach end-
of-life before replacement boats come on-line, and that the common 
missile compartment would be installed first in the new British 
submarine. Twelve new boats are planned for purchase, with the first 
scheduled to begin patrol in 2031. All DOD sustainment and 
modernization efforts for the submarine-based deterrent are fully 
funded in the President's fiscal year 2013-2017 request.
    With respect to ICBMs, the administration plans to sustain the 
Minuteman III (MMIII) through 2030. Ongoing intensive flight test and 
surveillance efforts will inform sustainment and modernization planning 
by providing better estimates for component aging and system 
reliability. The Air Force will begin an Analysis of Alternatives in 
2013 (to be completed in 2014), examining options and required 
capabilities for a follow-on system. Further, a small-scale program to 
maintain a ``warm'' production line for MMIII solid rocket motors was 
completed last year. Among key modernization issues is sustainment of 
the large-diameter solid rocket motor industrial base, pending 
decisions to produce a follow-on system. The President's budget request 
includes an $8 million Air Force study to evaluate a path forward to 
sustain this key industrial capability.
    Third, the United States will maintain two B-52H strategic bomber 
wings and one B-2 wing. Both bombers, however, are aging, and sustained 
funding and support are required to ensure operational effectiveness 
through the remainder of the aircrafts' service lives. The fiscal year 
2013 budget request allocates funding to upgrade these platforms; for 
example, providing the B-2 with survivable communications, a modern 
flight system, and updated radar.
    In addition, this year DOD intends to begin a program for a new, 
long-range, nuclear-capable, penetrating bomber that is fully 
integrated with a family of supporting aircraft and intelligence, 
surveillance, and reconnaissance assets. DOD continues to invest to 
ensure that we maintain an effective stand-off capability as the anti-
access threat continues to evolve. Thus, DOD is carrying out an 
Analysis of Alternatives, to be completed early in 2013, for an air-
launched cruise missile (ALCM) follow-on system called the long-range 
standoff (LRSO) missile. We plan to sustain the ALCM and the W80 ALCM 
warhead until the LRSO can be fielded.
    To allow us to continue the U.S. nuclear presence in Europe in 
support of our extended deterrence and assurance commitments, DOD is 
planning to provide a nuclear capability to the Joint Strike Fighter to 
replace aging F-16 dual-capable aircraft. The original plan was to 
deliver a dual-capable Joint Strike Fighter (JSF) in 2017. As a result 
of changes in the JSF program, the Air Force now intends to deliver 
nuclear capability to all JSFs in Europe in the 2020 timeframe via the 
Block IV upgrade. The Air Force will ensure there is no gap in our 
ability to meet extended deterrence assurances to our allies and 
partners.
    We also want to take note of a critical but often underappreciated 
component of strategic deterrence: the nuclear command and control 
(NC2) system that links the triad of nuclear forces. Independent of 
deployed delivery systems and warheads, we require robust, survivable, 
and effective systems for early warning, attack assessment, and force 
direction to support our existing nuclear employment plans, as well as 
associated contingencies.
    An effective NC2 system must clearly and unambiguously detect and 
characterize an attack; assemble key decision makers in a conference so 
an appropriate response can be chosen in a timely manner; disseminate 
emergency action messages to nuclear forces taking into account the 
survivability of the force elements involved; and provide enduring 
control of surviving forces.
    We plan to spend significant resources on NC2 system research and 
development, procurement, and operations and maintenance to address a 
range of challenges, including: the need for survivable satellite 
communications; survivable communications to forces; early-warning 
satellite modernization; improved, secure senior leader conferencing; 
hardening of critical communications links to electromagnetic pulse; 
and airborne and ground mobile command post sustainment/modernization.
                           physical security
    In addition to our efforts to revitalize weapons, delivery systems, 
and facilities, we continue to enhance nuclear physical security. Most 
notably, we have formalized DOD-DOE collaboration through a memorandum 
to pursue a common basis for the protection of nuclear weapons and 
weapons-usable fissile material. This effort will provide consistency 
when addressing enterprise nuclear concerns, facilitate collaborative 
risk-informed decisions, and provide better communication with 
Congress.
    The first major step in this process was the Nuclear Security 
Threat Capabilities Assessment, which was jointly developed by the 
Defense Intelligence Agency and the DOE Office of Intelligence/
Counterintelligence. This assessment provides the basis for developing 
a baseline of terrorist attack force size and capabilities to inform 
security system design and evaluation. DOD and DOE are moving forward 
to shape the methodology for vulnerability assessments, test and 
evaluation, and physical security standards to maximum commonality. 
Although the memorandum specifically links DOD and DOE efforts, DOD is 
also actively engaging with the Nuclear Regulatory Agency and our 
United Kingdom counterparts to optimize physical security methodology 
and our understanding of threats to the nuclear enterprise.
    Finally, DOD is enhancing the physical security posture in 
``nuclear mission environments,'' where the current environments meet 
nuclear weapons security standards, but there is room for improvement.
            international efforts to counter nuclear threats
    The last area we want to highlight is DOD's efforts to ensure that 
terrorists and proliferators cannot access nuclear materials and 
expertise abroad. Since September 11, 2001, there has been tremendous 
collaboration on this goal at the Federal level. President Obama has 
called nuclear weapons in the hands of terrorists ``the single biggest 
threat to U.S. security.'' In his words, just one nuclear weapon 
detonated in an American city would devastate ``our very way of life'' 
and represent a ``catastrophe for the world.'' For this reason, the NPR 
outlines a series of policies that reflect the gravity of this threat. 
Specifically, it placed the prevention of nuclear proliferation and 
nuclear terrorism at the very top of its list of five key objectives.
    To meet this goal, the United States has been aggressive in its 
threat reduction efforts; but it cannot meet this challenge alone. In 
President Obama's view, there is a pressing need to ``deepen our 
cooperation and to strengthen the institutions and partnerships that 
help prevent nuclear materials from ever falling into the hands of 
terrorists.'' Thus, DOD and its interagency partners are building on 
our long history of nuclear cooperation with allies such as the United 
Kingdom and France to expand that partnership into threat reduction 
activities. This mission is growing in importance for an increasing 
number of countries, and we will continue to make building 
international partnership capacity in this area a high priority.
    Just yesterday, we concluded the second Nuclear Security Summit in 
Seoul, South Korea. This gathering brought together more than 50 heads 
of state to address measures to combat the threat of nuclear terrorism, 
protect nuclear materials, and prevent the illicit trafficking of these 
materials. The Summit successfully built on the achievements of the 
first-ever Nuclear Security Summit in Washington, DC, in 2010, which 
focused on improving the security of weapons-grade plutonium and 
uranium. An outgrowth of the Washington, DC, Summit was the Global 
Nuclear Lockdown initiative, a 4-year effort to secure all vulnerable 
fissionable materials worldwide. This initiative involves participation 
from across the U.S. Government, including the Departments of State, 
Defense, Energy, Justice, and Homeland Security.
                               conclusion
    Upon taking office, President Obama made it a priority to sustain a 
safe, secure, and effective nuclear deterrent. Implementing these 
commitments requires a partnership between the executive branch and 
Congress. President Obama has demonstrated his commitment to these 
priorities, which have enjoyed strong bipartisan support in the past. 
We trust that Congress will continue to demonstrate the same 
commitment. These programs are central to our national security. They 
deserve full, bipartisan support.
    Our nuclear forces remain the foundation of deterrence. Our arsenal 
needs significant and immediate investment. Given the declining defense 
budget, some modernization efforts may proceed more slowly than 
desired, but to reiterate the President's statements, the NPR, and 
DOD's strategic guidance, the United States will maintain a safe, 
secure, and effective arsenal to deter threats to our Homeland, our 
deployed forces around the world, and our allies and partners. The 
President's fiscal year 2013 budget ensures that this will remain a 
leading national security priority.

    Senator Nelson. Thank you.
    In terms of the 10-year funding plan, Secretary Creedon, 
Secretaries Chu and Panetta sent the letter that I referenced 
before to Chairman Levin, dated March 2, 2012, explaining 
basically that they can't give Congress the 10-year funding 
projections from the revised 1251 plan, now known as section 
1043 of the NDAA for Fiscal Year 2012.
    Maybe you can tell us what happened and when we might be 
able to see something from DOD on that 10-year projection?
    Ms. Creedon. We obviously recognize that the report is 
late. With the reductions that needed to be made in the defense 
budget, there were also obvious adjustments in the strategic 
enterprise. So, we needed some time to look at the long-term 
impact of the reductions that were made in the 2013 budget, for 
instance the 2-year delay of the SSBN-X. We are right now in 
the process of completing that report, so hopefully, if it 
doesn't take too terribly long to get through all the various 
review procedures in DOD, we would hope that it would be 
provided in weeks.
    Senator Nelson. Weeks?
    Ms. Creedon. Weeks, not months. So hopefully in April.
    Senator Nelson. All right, thank you.
    Then, Secretary Creedon, in terms of the nuclear employment 
strategy, the President stated in a speech just this week in 
Korea that the administration is almost finished with the 
nuclear employment strategy that was originally called for in 
the 2010 nuclear posture review, and again in April of last 
year by National Security Adviser Donilon.
    Do you have any idea when we might see that strategy?
    Ms. Creedon. Again, Senator, I think that, as the President 
said, we are in the final throes of concluding that work. 
Obviously, it's difficult to tell when the President himself 
will be making the final decision, when this will happen. But 
here again, the hope is that it will be within the next couple 
of weeks.
    Senator Nelson. Secretary Weber, DOD signed a memorandum of 
understanding (MOU) with DOE to transfer some $8 billion in DOD 
budgetary authority to increase the top line of the NNSA 
budget. The MOU requires construction and operation of a new 
CMRR facility by 2022. Are you going to have to go back and 
renegotiate the terms of the MOU with the 5-year deferral of 
the CMRR facility proposed by NNSA in fiscal year 2013? A lot 
of concern has been raised about the replacement for the 
building and the proposal here. Can you tell us what might 
happen in terms of having to renegotiate?

   STATEMENT OF HON. ANDREW C. WEBER, ASSISTANT SECRETARY OF 
 DEFENSE FOR NUCLEAR, CHEMICAL, AND BIOLOGICAL DEFENSE PROGRAMS

    Mr. Weber. Thank you, Senator. We will not have to 
renegotiate the MOU. Through the Nuclear Weapons Council (NWC), 
which is the vehicle that DOE and DOD use to coordinate 
between, as Senator Sessions said, the consumer and the 
producer of the weapons in the stockpile, we had to make some 
hard choices this year in the President's 2013 budget request. 
One of those was the deferral of construction of the CMRR 
facility at Los Alamos for at least 5 years. The requirement 
for pit production capacity of 50 to 80, which is based on the 
current stockpile size, remains, so we accepted some schedule 
slip in order to sustain the critical life extension programs 
(LEP), such as the B61 gravity bomb LEP, which will enter the 
engineering development phase this year.
    The uranium processing facility at the Y12 plant in Oak 
Ridge, TN, this budget request actually accelerates 
construction of that facility, which DOD recommended to DOE as 
a higher priority of the two facilities because we have an 
urgent need. The current building where secondaries are 
produced at the Y12 plant dates back to the 1950s and is at 
risk. So we essentially staggered those two facilities, putting 
more of a near-term emphasis on the uranium processing 
facility.
    As far as the plutonium production capacity and capability, 
the revised NNSA plutonium strategy will give us some near-term 
capacity, we hope up to 20 to 30 pits per year, within the next 
5 years, and that's very important in support of the LEP for 
the W78-W88 common ICBM-Submarine Launched Ballistic Missile 
(SLBM) warhead that we're currently studying.
    Thank you.
    Senator Nelson. I'll come back to that in a minute. Senator 
Sessions?
    Senator Sessions. Secretary Creedon, how does DOD interface 
with DOE as you move forward with issues like this building? 
It's really not your choice whether Oak Ridge or Los Alamos 
goes first, is it, or is it? Are you consulted as to what you 
think the priorities are?
    Ms. Creedon. Senator, the NWC is a statutorily-mandated 
body that is actually chaired by DOD and is also populated by 
DOE. It's through that body that a lot of these decisions are 
made. It's through that body that there was a joint decision 
that the uranium processing facility, the facility at Y12 that 
Andy Weber was talking about, that builds the uranium 
secondaries, there was a decision that of the two buildings, if 
we couldn't afford to build both at the same time, which was at 
one point the plan, if we had to pick who goes first, NWC said 
plutonium goes second, uranium goes first. So that was, in 
fact, a joint decision of NWC.
    Senator Sessions. A joint decision, but the money is in the 
DOE budget. But you participated in that decision.
    Do you have any ability--I suppose you really don't, but 
what ability might you have to examine the plan for 
construction and see if it can be done at less expense? I have 
to say I believe we need to do whatever it takes to modernize 
our nuclear weapons, but I have been taken aback by the cost of 
these construction projects.
    DOE seems to be not as responsive as I would like to see 
them and as intensely interested in trying to accomplish the 
goal at the least possible expense, if you will forgive me. I'm 
sure they don't see it that way, but I haven't sensed the kind 
of intense interest in it.
    So where is that headed?
    Ms. Creedon. Again, in the context of NWC, there has been a 
lot of discussion about these two buildings and also about the 
cost of these two buildings, about the overall NNSA budget. In 
the MOU that Senator Nelson mentioned last year, there was an 
agreement for DOD to actually transfer money to NNSA, do some 
top-line transfers, to provide some more money to NNSA so that 
they could meet some of these obligations.
    DOD, in particular, through NWC, but DOD independently has 
also been engaged pretty closely with NNSA looking at the costs 
of things like the LEP for the B61, also for the uranium 
processing facility. So for instance, the Army Corps of 
Engineers did a pretty comprehensive study on the costs of the 
uranium processing facility and their estimate in their study 
was about $4.1 billion.
    Senator Sessions. $4.1 billion?
    Ms. Creedon. $4.1 billion.
    Senator Sessions. What was the DOE estimate?
    Ms. Creedon. The DOE estimate actually had been a little 
bit lower originally. So the Corps, by the time----
    Senator Sessions. It was about $8 or $10 billion total. Was 
that for both buildings?
    Ms. Creedon. That's about right, because the estimate at 
this point is they're about $4 to $4.5 billion apiece. That's 
where we were right now.
    So the Corps' estimate when they went through it, having 
also built in a contingency, was actually a little more than 
the initial DOE. But one of the things that's really important 
that NNSA is doing that DOD has encouraged NNSA to do is 
complete the design to the 90 percent level so that you can get 
a really good cost estimate.
    One of the historic problems with NNSA in some of the 
construction projects is they didn't have a good completed 
design, so that they didn't have really good cost estimates. So 
for both these two buildings they're going to get to that 90 
percent design level to do real independent cost estimates, so 
they have a real no-kidding baseline.
    Senator Sessions. I know I'm a Senate Budget Committee 
member here, but I'm not interested in buildings. I'm only 
interested in what we need, which is the weapons being 
modernized. If we have to have buildings, I guess we have to 
have buildings. If we have to have them, they should be as 
cost-effective as we possibly can get them and as much of the 
money as possible directed to the product that you need, the 
American people need, and not just for building buildings.
    The fiscal year 2013 budget for NNSA makes a number of 
changes. During a hearing yesterday General Kehler, head of 
STRATCOM, testified that he is concerned with the lack of a 
plan and strategy to meet STRATCOM requirements. According to 
General Kehler, he will ``be concerned until someone presents a 
plan that we can look at and be comfortable with and understand 
that it's being supported.''
    Secretary Weber, do you want to comment on that? Do you 
agree the commitment to modernize the nuclear weapons complex 
was a key element in ratification of the START treaty, and do 
you agree that the fiscal year 2013 budget does not meet the 
terms of the plan that was committed to at that time?
    Mr. Weber. As Secretary Panetta and Secretary Chu indicated 
in their letter to Chairman Levin, modernization remains a firm 
commitment for them and for this administration. We are dealing 
with a difficult budget situation in the country and that 
forced us to accept a little bit of schedule risk. We are 
comfortable with the President's fiscal year 2013 budget 
request, which actually increases the NNSA funding by $363 
million, about a 5 percent increase.
    Where we need to do work and, as General Kehler indicated 
in his testimony yesterday, we need to work closely with NNSA, 
and we've established a joint issue team to develop an 
executable, affordable plan for the out-years, 2014 and on, 
that meet our highest priorities, which are the weapons, the 
LEPs for the weapons and the capabilities in the complex, in 
the national laboratories, that support certification of the 
stockpile and design and production of the actual weapons.
    So we work very closely through the NWC, with General 
Kehler, with the Navy and Air Force Secretaries and Service 
Chiefs, to make sure that DOE maintains its focus on what the 
Nation needs for its safe, secure, and effective deterrent.
    Senator Sessions. I guess two questions. First, I think you 
said you agree that modernization is universally recognized as 
essential to the future viability of the nuclear weapons 
complex, and is a prerequisite for future reductions in our 
nuclear arsenal; is that correct?
    Mr. Weber. Yes, Senator. Modernization is essential, and as 
the stockpile----
    Senator Sessions. Now, DOD, for the record, of course, 
doesn't do this. DOE does this, and I understand General Kehler 
is saying that he's not comfortable with the plan that he's 
seen. He's the man that has the responsibility of receiving the 
weapons and he has to certify that they are ready to be used 
effectively if such an event were to occur.
    Would you say you agree that this budget does not honor the 
commitments that we need to achieve that goal? It's not your 
fault the money is not there. I'm just asking you your 
professional opinion. The goals that were laid out by DOD, does 
this budget meet those goals?
    Mr. Weber. The fiscal year 2013 budget request does meet 
those goals. It's the out-years that General Kehler and I and 
other members of the NWC are concerned about, and we owe you, 
together with NNSA, as the two Secretaries described in their 
letter, by this summer a solid, executable plan that will 
ensure in the long-term that the modernization objectives are 
met and that we have a sustained, safe, secure, and effective 
deterrent for the Nation.
    Senator Sessions. My time has expired. Thank you, Mr. 
Chairman.
    Senator Nelson. Thank you, Senator.
    There's no question that General Kehler was uncomfortable 
with the expectation that the future might not deliver what is 
needed. At best, it seems that you may be able to manufacture 
20 to 30 pits per year in 5 years, whereas the MOU requires 
NNSA be able to have the capacity to produce 50 to 80 pits per 
year in the 2022 timeframe.
    Has the 50 to 80 pit requirement changed? The second 
question is, has the timeframe when the capability is needed in 
2022 changed? Secretary Weber?
    Mr. Weber. No, the DOD requirement has not changed. 
However, the NWC did accept some schedule risk. We accepted 
deferral of the CMRR facility. What we need is a capability to 
produce plutonium pits in the near-term, and the revised 
plutonium strategy that NNSA presented to the NWC will provide 
a 20- to 30-pit per year capacity in the near-term, within 5 
years, and that will support the LEP for the common warhead 
that is among our highest priorities for the deterrent.
    Senator Nelson. Obviously everybody is interested in 
meeting the timeframes and meeting the other requirements.
    Let me switch now briefly here. Secretary Weber, my 
understanding is the initial estimates from NNSA for the B61 
gravity bomb that were submitted last fall by NNSA were far too 
expensive and they are now having to revise downward, a less 
expensive option. Can you explain what's happened from your 
perspective as executive agent for the NWC?
    Mr. Weber. Yes. The LEP for the B61 gravity bomb, which is 
used for both the B-2 strategic bomber as well as our dual-
capable aircraft that supports the deterrence mission in 
Europe, is critical. It's an aging weapon and we need to have a 
LEP underway.
    Last summer NNSA, based on the work done at the National 
Laboratories, presented essentially three options for the LEP. 
The high-cost option exceeded the threshold military 
requirement and clearly was not affordable. The NWC settled on 
the middle option that meets our military requirements, that 
will enhance the safety, security, and reliability of that 
warhead, and that will allow for consolidation of four variants 
into one, which we're calling the B61-12. This is synchronized 
with the tail kit program that the Air Force is initiating.
    Senator Nelson. Admiral Benedict, on the W76 warhead 
refurbishment delay, I understand NNSA has delayed the rate of 
refurbishment of the W76 Trident D5 warhead. What impact does 
this have and what kind of risk does it create for the fleet?

 STATEMENT OF RADM TERRY J. BENEDICT, USN, DIRECTOR, STRATEGIC 
                  SYSTEMS PROGRAMS, U.S. NAVY

    Admiral Benedict. Yes, sir. Mr. Chairman, as Secretary 
Creedon and Secretary Weber have discussed, as part of the 
budget discussions through the NWC, the decision was made to 
essentially rephase the program. The Navy will receive all 
operational reentry bodies and assets from NNSA by 2018. What 
we accepted was a 3-year delay in completing the total 
delivery, the last 3 years, which were the hedge requirements 
which we're required to have.
    So in terms of impacts to the fleet, sir, there are no 
impacts from an operational warfighting requirement due to the 
readjustment of the schedule.
    [The prepared statement of Admiral Benedict follows:]
           Prepared Statement by RADM Terry J. Benedict, USN
                              introduction
    Chairman Nelson, Ranking Member Sessions, distinguished members of 
the subcommittee, thank you for this opportunity to discuss Navy's 
strategic programs. It is an honor to testify before you this morning 
representing the Navy's Strategic Systems Programs (SSP).
    SSP's mission is to design, develop, produce, support, and ensure 
the safety of our Navy's sea-based strategic deterrent, the Trident II 
(D5) Strategic Weapon System (SWS). The Trident II (D5) Submarine 
Launched Ballistic Missile (SLBM) represents the Nation's most 
survivable strategic deterrent capability. The men and women of SSP and 
our industry partners remain dedicated to supporting the mission of our 
sailors on strategic deterrent patrol and our marines and sailors who 
are standing the watch, ensuring the security of the weapons we are 
entrusted with by this Nation.
    The Navy provides the most survivable leg of the U.S. nuclear triad 
with our ballistic missile submarines (SSBNs) and the Trident II (D5) 
SWS. A number of factors have contributed to an increased reliance on 
the sea-based leg of the triad. The 2010 Nuclear Posture Review 
reinforced the importance of the SSBNs and the SLBMs they carry. Under 
the New START treaty, SLBMs will comprise a majority of the Nation's 
operationally deployed nuclear warheads, thus increasing the Nation's 
reliance on the sea-based leg.
    Ensuring the sustainment of the sea-based strategic deterrent 
capability is a vital, national requirement today and into the 
foreseeable future. Our budget request provides the required funding in 
fiscal year 2013 for the Trident II (D5) SWS. To sustain this 
capability, I am focusing on four priorities: Nuclear Weapons Surety; 
the Trident II (D5) SWS Life Extension Program; the Ohio Replacement 
Program; and the Solid Rocket Motor (SRM) Industrial Base. Today, I 
would like to discuss my four priorities and why these priorities are 
keys to the sustainment of the Navy's sea-based strategic deterrent and 
its future viability.
                         nuclear weapons surety
    The first priority I would like to address, and arguably the most 
important priority, is the safety and security of the Navy's nuclear 
weapons. Navy leadership has clearly delegated and defined SSP's role 
as the program manager and technical authority for the Navy's nuclear 
weapons and nuclear weapons security.
    At its most basic level, this priority is the physical security of 
one of our Nation's most valuable assets. Our Marines and Navy Masters 
at Arms provide an effective and integrated elite security force at our 
two Strategic Weapons Facilities in Kings Bay, GA, and Bangor, WA. U.S. 
Coast Guard Maritime Force Protection Units have been commissioned at 
both facilities to protect our submarines as they transit to and from 
their dive points. These coast guardsmen and the vessels they man 
provide a security umbrella for our Ohio-class submarines. Together, 
the Navy, Marine Corps, and Coast Guard team form the foundation of our 
Nuclear Weapons Security Program.
    SSP's efforts to sustain the safety and improve the security of 
these national assets continue at all levels of the organization. My 
command maintains a culture of self-assessment in order to sustain 
safety and security. We continue to focus on the custody and 
accountability of the nuclear assets that have been entrusted to the 
Navy. SSP's number one priority is to maintain a safe, secure and 
effective strategic deterrent.
                       d5 life extension program
    The next priority I would like to discuss is SSP's life extension 
efforts to ensure a future, effective, and reliable sea-based 
deterrent. We are executing the Trident II (D5) Life Extension Program 
in cooperation with the United Kingdom, under the auspices of the 
Polaris Sales Agreement. I am pleased to report that our longstanding 
partnership with the United Kingdom remains strong.
    The Trident II (D5) SWS continues to demonstrate itself as a 
credible deterrent and exceeds the operational requirements established 
for the system almost 30 years ago. Our allies and any potential rivals 
are assured the U.S. strategic deterrent is ready, credible, and 
effective. However, we must remain vigilant of age-related issues to 
ensure a continued high level of reliability.
    The Trident II (D5) SWS has been deployed on our Ohio-class 
ballistic missile submarines for over 20 years, and is planned for a 
service life of 50 years. This is well beyond its original design life 
of 25 years and more than double the historical service life of any 
previous sea-based deterrent system. As a result, significant efforts 
will be required to sustain a credible and viable SLBM force from now 
until the end of the current Ohio-class SSBN in the 2040s as well as 
the end of the service life of the Ohio-replacement SSBN in 2080s.
    The Navy is proactively taking steps to address aging and 
technology obsolescence. SSP is extending the life of the Trident II 
(D5) SWS to match the Ohio-class submarine service life and to serve as 
the initial baseline mission payload for the Ohio-replacement submarine 
platform. This is being accomplished through an update to all the 
Trident II (D5) SWS subsystems: launcher, navigation, fire control, 
guidance, missile and reentry. Our flight hardware--missile and 
guidance--life extension efforts are designed to meet the same form, 
fit, and function of the original system, in order to keep the deployed 
system as one homogeneous population and to control costs. We will also 
remain in continuous production of energetic components such as solid 
rocket motors. These efforts will provide the Navy with the missiles 
and guidance systems we need to meet operational requirements.
    SSP recently achieved a significant programmatic milestone in our 
life extension program. The first end-to-end operational test of 
Trident II (D5) life-extension guidance system was successfully 
conducted in February from the USS Tennessee (SSBN 734). SSP embarked 
on a major overhaul of the guidance system over a decade ago to extend 
the life of the guidance system to match the hull-life of the Ohio-
class SSBNs. This represented the most significant guidance engineering 
effort since the development of D5 over 30 years ago.
    Another major step to ensure the continued sustainment of our SWS 
is our SSP Shipboard Integration efforts, which utilizes open 
architecture and commercial off-the-shelf hardware and software for 
shipboard systems. The first increment of this update is now being 
installed throughout the fleet and training facilities. To date, 
installation is complete on seven U.S. SSBNs and all four United 
Kingdom SSBNs. This effort is a technical obsolescence refresh of 
shipboard electronics hardware and software upgrades, which will 
provide greater maintainability of the SWS and ensure we continue to 
provide the highest nuclear weapons safety and security for our 
deployed SSBNs.
    To sustain the Trident II (D5) SWS, SSP is extending the life of 
the W76 reentry system through a refurbishment program known as the 
W76-1. This program is being executed in partnership with the 
Department of Energy, National Nuclear Security Administration. The 
W76-1 refurbishment maintains the military capability of the original 
W76 for approximately an additional 30 years.
    In addition to the W76-1, the Navy also is in the initial stages of 
refurbishing the W88 reentry system. The Navy is collaborating with the 
Air Force to reduce costs through shared technology. These programs 
will provide the Navy with the weapons we need to meet operational 
requirements throughout the Ohio service life and the planned follow-on 
platform.
                        ohio replacement program
    One of the highest Navy priorities is the Ohio Replacement Program. 
The continued assurance of our sea-based strategic deterrent requires a 
credible SWS as well as the development of the next class of ballistic 
missile submarine. The Navy team is taking aggressive steps to ensure 
the Ohio Replacement SSBN is designed, built, and delivered on time 
with the right capabilities at an affordable cost.
    The Navy team has the benefit of leveraging the success of the 
Virginia-class build program and the opportunity to implement many of 
those lessons-learned to help ensure we design the Ohio Replacement 
Program for affordability both in terms of acquisition and life cycle 
maintenance. Maintaining this capability is critical to the continued 
success of our sea-based strategic deterrent now and into the future.
    The Ohio Replacement Program will replace the existing Ohio-class 
submarines. To lower development costs and leverage the proven 
reliability of the Trident II (D5) SWS, the Ohio Replacement SSBN will 
enter service with the Trident II (D5) SWS and D5 life-extended 
missiles onboard. These D5 life extended missiles will be shared with 
the existing Ohio Class submarine until the current Ohio-class retires. 
Maintaining one SWS during the transition to the Ohio-class replacement 
is beneficial from a cost, performance, and risk reduction standpoint.
    A critical component of the Ohio Replacement Program is the 
development of a common missile compartment that will support Trident 
II (D5) deployment on both the Ohio-class replacement and the successor 
to the United Kingdom Vanguard-class. The United States and the United 
Kingdom have maintained a shared commitment to nuclear deterrence 
through the Polaris Sales Agreement since April 1963. The United States 
will continue to maintain its strong strategic relationship with the 
United Kingdom for our respective follow-on platforms, based upon the 
Polaris Sales Agreement. As the Director of SSP, I am the U.S. Project 
Officer for this agreement. Our programs are tightly coupled both 
programmatically and technically to ensure we are providing the most 
cost effective, technically capable nuclear strategic deterrent for 
both nations.
    Consistent with the defense strategic guidance, the Navy is 
delaying the Ohio Replacement Program by 2 years. While the overall 
program is being delayed by 2 years, we are maintaining the original 
program of record for the design of the common missile compartment and 
SWS deliverables in order to meet our obligations to the United 
Kingdom. The United States and United Kingdom are working jointly to 
prioritize risk and develop a mitigation plan underthe auspices of the 
Polaris Sales Agreement.
    Our continued stewardship of the Trident II (D5) SWS is necessary 
to ensure a credible and reliable SWS is deployed today on our Ohio 
Class submarines, as well as in the future on the Ohio Replacement 
SSBN. This is of particular importance as the reliance on the sea-based 
leg of the Triad increases as New START treaty reductions are 
implemented. The Ohio Replacement will be a strategic, national asset 
whose endurance and stealth will enable the Navy to provide continuous, 
uninterrupted strategic deterrence into the 2080s.
                   solid rocket motor industrial base
    The fourth priority I would like to discuss is the importance of 
the defense and aerospace industrial base. In particular, the decline 
in demand for the SRM industry has placed a heavy burden on Navy 
resources. The Navy is maintaining a continuous production capability 
at a minimum sustaining rate of 12 rocket motor sets per year through 
the Future Years Defense Plan. However, we previously have faced 
significant cost challenges as both the National Aeronautics and Space 
Administration (NASA) and Air Force demands have declined.
    Over the past few years the Navy has worked with our industry 
partners to reduce overhead costs and minimize cost increases to the 
Department. Despite many efforts to address this issue, the industrial 
base remains volatile. Potential future unit cost increases due to 
further decline in SRM industrial base demand could impact the D5 Life 
Extension Program. We will continue to cautiously monitor the 
industrial base.
    The Office of the Secretary of Defense-led Interagency Task Force 
developed a SRM Industrial Base Sustainment and Implementation Plan. 
One of the conclusions of the report is that ``The Department must 
preserve the scientific, engineering and design skills and production 
capabilities necessary to support both large- and small-SRMs.'' SSP 
will continue to work with our industry partners, the Department of 
Defense, NASA, Air Force, and Congress to sustain the SRM industrial 
base and find ways to maintain successful partnerships to ensure this 
vital national capability is maintained.
                               conclusion
    SSP will continue to maintain a safe, secure, and effective 
strategic deterrent capability and focus on the custody and 
accountability of the nuclear assets entrusted to the Navy. Our budget 
request provides the necessary funds to sustain this capability in 
fiscal year 2013. However, we must continue to be vigilant of 
unforeseen age-related issues to ensure the high reliability required 
of our SWS. SSP must maintain the engineering support and critical 
skills of our industry and government team to address any future issues 
with the current system as well as prepare for the future of the 
program.
    Our Nation's sea-based deterrent has been a critical component of 
our national security since the 1950s and will continue to assure our 
allies and deter our rivals well into the future. I am privileged to 
represent this unique organization as we work to serve the best 
interests of our great Nation.

    Senator Nelson. Admiral Benedict, I understand that the 
Ohio replacement's going to be delayed 2 years. Once again, can 
you explain what impacts this may have on the common missile 
compartment program that you manage with the British, and how 
old the first Ohio-class boat will be when it's retired?
    Admiral Benedict. Yes, sir. Today the Ohio replacement 
program will have 12 submarines, which will replace the 14 
existing Ohio-class submarines. You're correct that the 
decision was made to delay by 2 years. Having 12 Ohio 
replacement submarines will give us the 10 operational that we 
require in order to support the STRATCOM at-sea requirement.
    We will have a period of time, essentially through the 
2030s, when we will be at that 10 minimum number in order to 
sustain the warfighting requirement. That will impose 
additional risk on the Navy. We believe that is manageable. 
Essentially, all Ohio-class will be, give or take a number of 
months, sir, within about 42 years of age at their retirement.
    Senator Nelson. My time has expired. Senator Cornyn.
    Senator Cornyn. Thank you, Mr. Chairman.
    I just have a few questions with regard to nuclear 
modernization funding. When the New START treaty was ratified 
in the Senate, there were certain representations made by the 
administration, as well as assurances given by the 
appropriators in the Senate. I hear Senator Sessions may have 
touched on this some.
    During yesterday's full committee hearing of the Senate 
Armed Services Committee, General Kehler of STRATCOM expressed 
his concerns about the funding shortfall in the President's 
budget request. Using the 1251 modernization plan as a 
baseline, the fiscal year 2013 request falls $372 million short 
and funding between fiscal years 2012 and 2017 could fall $4 
billion short on the 1251 commitment.
    General Kehler noted the slips to the B61 and W75 LEPs 
indicated that, while it would increase risk, it would be 
manageable, which I appreciate always. When our military says 
it's manageable, that's your job, to manage with the resources 
that you are given; not that it's optimal, but that it may be 
manageable.
    He was concerned about deferring the start of construction 
of the plutonium handling facility, the CMRR facility, and 
perhaps more important, was uncertain about the 
administration's alternative course of action for producing the 
necessary number of nuclear pits to maintain a responsive 
infrastructure. It seems odd to me that DOD would agree to the 
fiscal year 2013 funding request and alternative to CMRR 
without knowing whether it's technically feasible or cost-
effective or whether the funding will be provided in the out-
years necessary to accomplish these tasks.
    So I would ask, Secretary Creedon and Secretary Weber, 
perhaps in light of these comments, can you tell us whether you 
share these concerns and what the state of thinking of DOD is 
with regard to the way forward. How could NWC approve the 
fiscal year 2013 budget request with so much uncertainty?
    Ms. Creedon. Thank you, sir. In general terms, yes, we do 
share the concerns of General Kehler. To focus on the 2013 
budget request, at the moment, the 2013 budget request is okay. 
We've made some adjustments in some of the scheduled programs, 
but 2013 is okay.
    Where we are all concerned and where we have work to do is 
in the out-years.
    Senator Cornyn. If I may just ask for clarification, you 
say you're okay in fiscal year 2013, and that is because the 
funding request meets what was represented to be the 
prospective funding at the time the New START treaty was 
ratified?
    Ms. Creedon. 2013 is a little bit less than what was 
projected to be in 2013 in the 1251 report, but it's only a 
slight degree. It's only a little bit less, and it's more than 
the appropriated amount in 2012. With some schedule adjustments 
to some of the systems, specifically the 61, the 76-1 LEP, 
there's been some opportunity to have this reduction and have 
2013 be okay.
    Now, one of the big issues, obviously, is the issue of not 
doing both the plutonium building and the uranium building 
simultaneously. That was the decision that NWC made, to put the 
uranium building first and the plutonium building second, with 
some adjustments that NNSA is going to do in their overall 
plutonium strategy to allow an increase in production at the 
PF4 facility where the pits are actually made. So PF4 is the 
facility where pits are actually made and the CMRR, in other 
words the replacement facility, is where they do a lot of the 
analytical work, they store the plutonium, and they do a lot of 
the support work to allow the production of the pits.
    So with some adjustments in the PF4 building and some 
adjustments throughout the complex, there is an ability to 
increase the production at PF4 in the near-term to about 20 
pits and possibly a little bit more in the near-term, until we 
can get the plutonium building completely designed, the uranium 
building built, and then the plan is to go back then and pick 
up the construction and funding of the CMRR, the plutonium 
building.
    So that's the current plan. But we need to fit this in the 
out-year's budgets, because right now the out-year's budgets 
are, as General Kehler said, not a reliable plan at the moment.
    Senator Cornyn. So if I understood you correctly, there is 
a potential of producing as many as 20 pits using the current 
operations facility?
    Ms. Creedon. Yes.
    Senator Cornyn. But the requirement is multiples of that, 
is it not?
    Ms. Creedon. The objective requirement is 50 to 80, based 
on what the longer-term LEP decisions are. So right now, with 
the decisions for the LEP on the 61 and the completion of the 
76-1, the capability at PF4 that will be provided in the 
interim is adequate. It's the decision on the next round of LEP 
that starts to then generate the requirement for pits at PF4.
    Senator Cornyn. Mr. Chairman, may I have one last question, 
if I may, please?
    Senator Nelson. Sure, sure.
    Senator Cornyn. I'd like to ask whether DOD would be 
willing to help our committee identify efficiencies within the 
National Laboratories or NNSA that would free up funding for 
the important weapons LEPs or perhaps even to fund the 
construction of CMRR on its original schedule. In other words, 
about $300 million is needed in fiscal year 2013 and $1.8 
billion over the next 5 years.
    First of all, do you believe that there are efficiencies 
that could be identified within the National Laboratories and 
NNSA? If there are, would you be willing to work with us to try 
to find those in a way that keeps the original commitment, that 
I believe a lot of Senators relied upon in voting to ratify the 
New START treaty?
    Ms. Creedon. Senator, we would be happy--in fact, DOD is 
working very closely with NNSA right now, going through a 
process to try and identify efficiencies. But at some point, it 
really depends on what the annual budget is as to what we can 
accomplish. Even with efficiencies, there's only so much you 
can do with efficiencies based on whatever the outyear top line 
is. But we would be more than happy--in fact, we've already 
started that process internally.
    Senator Cornyn. I appreciate that. We'll be happy to work 
with you to find those, and if there's money that's not being 
used to good purpose it seems to me that that's something--
that's a commitment that was made that we need to make sure is 
kept.
    Thank you, Mr. Chairman.
    Senator Nelson. Thank you, Senator Cornyn.
    Senator Reed.
    Senator Reed. Thank you very much, Mr. Chairman.
    Thank you, witnesses. I think the chairman touched upon the 
delay of the Ohio-class submarine, but I want to ask a few more 
questions. When General Kehler was before us as STRATCOM 
commander, in response to Senator Blumenthal he pointed out 
that survivability of the deterrent is one of the key factors 
that must be considered. My understanding of this conversation 
was that he saw the submarine as providing the most survivable 
deterrent and therefore the Ohio-class replacement is the top 
priority in terms of the rebuilding or refurbishing the nuclear 
triad.
    Madam Secretary, can you talk about this priority in the 
context of support by DOD to the Navy to make sure we get this 
done? Because I think one of the issues that we're running 
into, and I think similarly with respect to the other Services, 
these platforms, this replacement, is expensive. It crowds out 
shipbuilding and other key aspects that we have to do, unless 
there's some support from DOD because of the strategic nature 
of the platform.
    Can you comment on that, Madam Secretary?
    Ms. Creedon. Yes, sir. From a policy perspective, 
maintaining all three legs of the triad is DOD and the 
administration's commitment, and the submarine, as you 
mentioned, is the most survivable leg of the triad. So from a 
policy perspective, the ability to maintain and fund that leg 
of the triad is critical.
    But, recognizing the fiscal constraints, the decision to 
slip the first Trident--to slip the program by 2 years and then 
save about $4 billion within the Future Years Defense Program, 
that level of risk was acceptable. We recognize the fiscal 
constraints and it still maintains the commitment to the triad.
    For any operational specifics, I think I'd rather defer, 
though, to Admiral Benedict.
    Senator Reed. I'd be happy to hear from Admiral Benedict. 
One further elaboration is that this slip is just for 2 years, 
so we will begin in earnest the research and design, 
construction, et cetera. But what happens still, even though 
we've pushed the problem back 2 years, at some point you have a 
lot of different platforms, ships in this case, that have to be 
built and, given the strategic nature of this system, the Navy 
top line might have to be adjusted upwards by DOD resources to 
make sure it can be done to maintain the triad, all three parts 
of it, but leading with the submarine.
    Admiral Benedict, please, your comments?
    Admiral Benedict. Yes, sir, Senator. As Mr. Stackley and 
Vice Admiral Blake described this morning, the Navy is in 
conversation, Navy leadership, with the Office of the Secretary 
of Defense (OSD) on the potential to do that. Those discussions 
are ongoing. It's clearly recognized within all levels of 
leadership the pressure that the Ohio replacement program puts 
on the total Navy shipbuilding program, and I believe that 
those discussions will run their course in due time, sir, as 
Mr. Stackley described.
    Senator Reed. Thank you.
    A final question and this goes back to the very difficult 
budget choices you have to make. You might want to comment, and 
this is not particularly profound--we're going to have to do 
some prioritizing in terms of what we build and the sequence of 
building these platforms. So the goal is, and I agree with you, 
to maintain the triad, but the pace of replacement of air- and 
land-based systems and sea-based systems is something that 
you're going to have to consider because of the budget. Is that 
fair?
    Ms. Creedon. Yes, sir. Looking from a policy perspective, 
again looking at all of the systems in the triad, looking at 
what their current life expectancy is, when we need new ones, 
that's part of the overall OSD discussions in terms of 
maintaining the triad. At the moment it was clear that, based 
on the extended life of the hull of the Tridents, that was an 
acceptable risk, to slip it by 2 years.
    On the other hand, the bombers stayed on schedule and we're 
continuing with the Minuteman LEP to get the Minuteman up to 
2030.
    Senator Reed. One final question. That is, there's a new--I 
guess it's not that new, but there's a new factor. That's 
cyber, in terms of development of systems, the deployment of 
systems, the survivability of systems. I'm old enough--in the 
1950s, 1960s, 1970s, this was not a significant factor. I'm 
talking about the effect of a cyber attack, not on military 
installations directly, but the utilities that serve it, so 
that your power's down, disrupting communications, et cetera.
    Is that being weighed also, and does that go to the point 
that General Kehler made about the survivability of the 
seaborne deterrent because of its potential to withstand cyber? 
Conversely, are other systems more vulnerable to cyber? It's a 
big question, but if anyone would like to comment.
    Ms. Creedon. Other than just generally yes, we are looking 
at that. Nuclear command and control is extraordinarily 
important. But in terms of the specifics for the platform, I 
would prefer, frankly, to defer to my colleagues from the 
Services.
    Senator Reed. General?

 STATEMENT OF LT. GEN. JAMES M. KOWALSKI, USAF, COMMANDER, AIR 
          FORCE GLOBAL STRIKE COMMAND, U.S. AIR FORCE

    General Kowalski. Yes, Senator. We just wrapped up a study 
of the cyber vulnerabilities of the ICBM and the conclusion of 
the study was it was an invulnerable system in terms of getting 
into the actual command and control. I take your point, that 
some of the supporting systems might be vulnerable. In fact, 
we've already taken measures to close those gaps. It was a 
worthwhile effort. It took us about a year.
    In our other systems, we have looked at the same thing and 
we're pretty confident with where we are.
    [The prepared statement of General Kowalski follows:]
         Prepared Statement by Lt. Gen. James M. Kowalski, USAF
                              introduction
    Chairman Nelson, Ranking Member Sessions, and distinguished members 
of the subcommittee; I am honored to appear again before you today as 
the Commander of Air Force Global Strike Command (AFGSC), representing 
nearly 24,000 dedicated airmen and civilians.
    Our mission at AFGSC is clear. We organize, train, and equip combat 
ready forces for nuclear deterrence and global strike operations with 
an intense focus on ensuring a safe, secure, and effective nuclear 
arsenal and global strike force to support the President of the United 
States and the combatant commanders.
    As we move forward in reducing our force to the New START levels, I 
am confident that with your support our airmen will meet that mission 
while demonstrating the disciplined professionalism our Nation expects 
of the stewards of this fundamental national security capability.
     air force global strike command update--organize, train, equip
    I would like to take this opportunity to update you on the command 
by discussing the initiatives and challenges to ``organize, train, and 
equip'' our force so we remain ready across a broad mission set. Only 
through constant attention to readiness metrics can we responsibly 
balance fiscal austerity with ready forces to support the combatant 
commanders for nuclear deterrence and a broad range of conventional 
missions.
Organize
    During this past year, our Command grew with the transfer of 
nuclear weapons Munitions Squadrons from Air Force Materiel Command. 
This transfer to AFGSC further strengthened the nuclear enterprise 
through enhanced unity of command and streamlined operational 
coordination. Additionally, we activated a new munitions division at 
the headquarters to provide advocacy, guidance and oversight to the 
conventional, nuclear, and armament systems activities across the 
command.
    We also strengthened the nuclear enterprise through our efforts as 
the core function lead integrator for Air Force nuclear deterrence 
operations. In support of the Air Force corporate planning and 
programming structure, we developed the Nuclear Deterrence Operations 
Core Function Master Plan (NDO CFMP) in collaboration with key 
stakeholders across the Air Force. The NDO CFMP aligns nuclear 
deterrence strategy, operating concepts, and capability development. It 
is a long range plan that forms a reference point for helping the Air 
Force mold its strategic priorities, risks, and tradeoffs.
    As we looked for opportunities to improve our nuclear deterrence 
operations, we won approval to serve as the chief architect for the Air 
Force Nuclear Command and Control system. This strengthens our role as 
lead program manager for 14 nuclear command, control, and 
communications (NC3) systems and programs. In this capacity, AFGSC 
created a roadmap to effectively sustain the Strategic Automated 
Command and Control System through 2030.
    We also found that by developing a governance structure of 
stakeholders in our key weapon systems we were able to establish 
relationships and understanding that has led to continued improvements 
in weapon system performance and faster solutions to problems. These 
General Officer Steering Groups for the B-2, B-52, Minuteman III, and 
UH-1N ensure decisionmakers prioritize and resolve key sustainment 
support issues.
    To better support our missile wings, AFGSC adopted the Schlesinger 
Report recommendation to renew the assignment of intelligence officers 
to the missile wings. Today, those officers fill a critical gap, 
providing a better understanding of real-world events and deploying a 
number of intelligence tools that were not previously accessible. Our 
missile wing intelligence officers are also playing a vital role in 
ensuring the safety and security of our nuclear weapons and personnel 
through support for force protection and anti-terrorism programs at the 
wings.
    We also continue to refine our Nuclear Surety Council (NSC). The 
NSC is a quarterly meeting across our enterprise to identify nuclear 
surety issues and track them to resolution. During the course of 2011, 
the NSC successfully monitored and closed a number of issues to include 
improvements to nuclear convoy security, implementing technical order 
changes at Intercontinental Ballistic Missile (ICBM) Launch Control 
Centers, increasing missile field security by upgrading land mobile 
radio coverage, and completing permanent repairs to flooded defense 
access roads used to reach launch facilities in North Dakota. The 
success of the AFGSC NSC in 2011 ensured continued strengthening of the 
nuclear enterprise.
    As part of our efficiency efforts, we reviewed our ongoing 
operations and adjusted how we provide forces to U.S. Pacific Command 
under the Continuous Bomber Presence (CBP) mission. We transitioned 
deployment duration from 4 to 6 months and changed our logistics and 
support concepts to reduce the rotations of aircraft, tools, and parts. 
These actions yielded $21 million of savings in annual flying hours and 
logistic shipment costs.
    Train
    In partnership with Air Combat Command we reviewed and prioritized 
our aircrew training to better align with the missions the combatant 
commanders have told us are most important to them. We have improved 
the execution of our flying hour program and established benchmarks for 
sortie production. The most critical training in our bomb wings--for 
operations, maintenance, munitions and support--is done by generating 
the sorties needed to meet the weekly flying schedule.
    AFGSC played a major role in U.S. Strategic Command's (STRATCOM) 
capstone nuclear exercise, while also directing the first major 
command-level nuclear operational readiness exercise in over 20 years. 
These two major exercises serve to focus the command's nuclear training 
and provide recurring mission emphasis.
    Conducting inspections is an essential command function, and we 
have made significant progress in this area. Over the course of the 
last year, the command conducted 19 scheduled and no-notice inspections 
of which 15 were focused on strategic bomber and ICBM nuclear mission 
areas. We also established an Inspection Deficiency Review Board to 
track deficiencies indentified during our unit inspections. This 
deliberate process puts the command staff's attention on both the 
deficiencies and corrective actions.
    Another command initiative is to reduce, synchronize, and integrate 
all non-nuclear inspections, audits, assessments, and evaluations into 
a consolidated unit inspection regime providing commanders at every 
level a more comprehensive organizational assessment of readiness and 
compliance.
    This initiative, coupled with our efforts that deconflict and 
synchronize inspection and exercise schedules, provides a more 
predictable unit calendar allowing our wing commanders additional time 
to focus on individual and small unit training.
    Exercises and inspections are important training tools, but we are 
also using competition to promote esprit de corps and stimulate 
tactical innovation. Global Strike Challenge 2011 marked it's the 
second year as the Air Force's premiere bomber, missile, security 
forces, and maintenance competition. The competition is rooted in the 
rich heritage of Strategic Air Command's Proud Shield, Giant Sword, and 
Olympic Titan competitions. Global Strike Challenge has become an event 
that Airmen across the command eagerly anticipate and has contributed 
to improved morale, pride in our mission, and a culture of excellence 
through the crucible of competition.
    Equip
    AFGSC is the lead command for the B-2, B-52, Minuteman III, and UH-
1N weapon systems. We identify requirements, advocate and program for 
resources, and maintain weapons systems stewardship for these mission-
critical assets.
    B-2
    Our 20 B-2s represent the Nation's only long-range bomber capable 
of penetrating advanced enemy air defenses in an anti-access, areal 
denial scenario. The B-2 is the most modern bomber in America's 
arsenal, yet it is approaching 20 years old.
    The President's budget contains critical B-2 sustainment 
initiatives, to include $656 million for modernization of the B-2's 
Defensive Management System which will improve aircrew awareness and 
facilitate avoidance of modern and future air defense threats. This 
system is crucial to the B-2's ability to hold any target at risk by 
penetrating enemy air defenses.
    The B-2 has other important requirements to be addressed in the 
future. A secure, survivable, strategic communications path is required 
as current communications systems rapidly approach the end of their 
service life. We are working a more affordable very low frequency/low 
frequency solution to prevent a nuclear-survivable communications gap 
while we await the maturation of a common EHF SATCOM terminal for 
integration on the B-2.
    B-52
    The B-52Hs flying today entered service from 1961 to 1962. 
Regularly updated over the past 50 years, the dual-role capable B-52 is 
capable across the range of military operations and employs the widest 
variety of ordnance in the fleet.
    We are celebrating this year as the ``Year of the B-52,'' marking 
both the 50th anniversary of the last delivery of a B-52 to Minot AFB, 
and the 60th anniversary of the first test flight of the YB-52. This 
aircraft may be the most universally recognized symbol of American 
airpower, and its contributions to our national security through the 
Cold War, Vietnam, Operation Desert Storm, Kosovo, Operation Iraqi 
Freedom, and Allied Force are remarkable. We invite Congress to join us 
in this celebration.
    Of course, there are B-52 sustainment issues we must address. The 
President's budget request contains $24 million for a 1760 databus to 
the B-52's internal bomb bay. This upgrade will enable the B-52 to 
carry 20 J-series ``smart'' weapons instead of 12, and the internal 
carriage of smart weapons also improves the aircraft's fuel efficiency. 
Finally, this upgrade will allow us to carry mixed internal weapons 
loads, providing even more flexibility for combatant commanders.
    Future B-52 requirements include a data link and voice 
communications to facilitate net-centric warfare operations envisioned 
in the Air/Sea Battle concept. The aging radar on the venerable bomber 
will also need to be replaced within the next decade as sustainment 
costs grow and failure rates increase.
    Minuteman III
    The Minuteman III ICBM is the least expensive and most responsive 
leg of the nuclear triad and is fundamental to ensuring strategic 
stability with nuclear peers. The Minuteman III dramatically 
complicates any adversary's offensive and defensive plans, and hedges 
against technical or geo-political surprise.
    The Minuteman III system became operational in 1970 with an 
expected life span of 10 years but still maintains an alert rate of 
over 99 percent. We thank Congress for funding a number of sustainment 
programs to include replacing the boosters, upgrading environmental 
controls, modernizing security and support equipment, and procuring new 
reentry system payload transport vehicles.
    The President's fiscal year 2013 budget request fully funds warhead 
fuze replacement initiatives in partnership with the Navy, a new 
transporter erector, and continues effort toward the next solid rocket 
motor program. We continue to closely examine emerging needs to include 
guidance systems upgrades to ensure Minuteman III reliability and 
readiness through 2030.
    UH-1N
    With the proposed termination of the Common Vertical Lift Support 
Program (CVLSP), also known as the common support helicopter (CSH), the 
Air Force will continue to fly UH-1N ``Hueys,'' with a focus on two 
critical national security missions: nuclear asset security for AFGSC 
and Continuity of Operations/Continuity of Government taskings for the 
Air Force District of Washington.
    The average age of the UH-1N fleet is over 40 years old. 
Anticipating the Air Force may fly the UH-1N for another decade or 
longer, we must selectively modernize the UH-1N to minimize existing 
capability gaps and to avoid increased sustainment costs brought on by 
obsolescence. These efforts include making the cockpit fully night 
vision compatible, upgrading the sensors to better support our security 
mission, and performing some delayed safety and sustainment 
improvements. We will continue to look for pragmatic and creative ways 
to mitigate risk with the current fleet.
    Long-Range Strike Family of Systems
    We are strong advocates and partners in the development of a Long-
Range Strike (LRS) Family of Systems that will provide a visible 
deterrent and global strike capability well into the future. The Air 
Force LRS strategy conceptually uses a Family of Systems construct 
consisting of three precision-strike pillars: a Long-Range Strike 
Platform (LRSP), a Long Range Standoff Missile (LRSO), and a 
Conventional Prompt Global Strike (CPGS) capability. Work continues on 
the Analysis of Alternatives (AoA) for LRSO to replace the Air Launched 
Cruise Missile (ALCM), though recent budgetary realities have resulted 
in a 2-year slip of this program. The AoA will be completed in late 
2012 and will be used to inform future funding decisions.
    We are also eager to make progress with Air Combat Command in 
developing and fielding the new Long-Range Strike Bomber. This bomber 
will be essential in providing capabilities needed for strategic 
deterrence of adversaries fielding advanced anti-access and area denial 
weapons. Those capabilities must include penetrating denied airspace to 
find and efficiently engage mobile systems and time sensitive targets.
    Ground Based Strategic Deterrent
    In March 2010, STRATCOM requested AFGSC initiate mission 
requirements analysis for the Ground-Based Strategic Deterrent, the 
follow-on system to the Minuteman III. The Nuclear Posture Review 
reiterated the need and stated that although a decision on any follow-
on ICBM is not needed for several years, studies to inform that 
decision are needed now.
    In January of last year, we began the Capabilities Based Assessment 
(CBA), which is the first step in the Joint Capabilities Integration 
and Development System process. The CBA was a joint effort of a team 
composed of representatives from across the Air Force, the Office of 
the Secretary of Defense, and the Joint Force. The CBA took a 
``strategy to task'' look at higher level guidance and from that 
guidance, identified those tasks required to meet our mission 
objectives. The next step is to conduct a formal AoA identifying 
potential solutions and provide comparative cost, effectiveness, and 
risk assessments of each. This work is scheduled to start March 2013.
                       challenges and conclusion
    Our challenge for the next year is to strengthen a culture in which 
every airman embraces the special trust and responsibility of our 
nuclear deterrent mission, maintaining our excellence in conventional 
missions across the range of military operations, and finally enhancing 
and sustaining the current force while modernizing for the future.
    Mr. Chairman, our airmen continue to rise to these enduring 
challenges and they have made measurable improvements across the 
command. It is my distinct privilege to lead them through the 
challenges, and opportunities, our Nation faces. I assure you and this 
committee they remain fully committed to executing all current missions 
to the highest standards, and I know their professionalism allows AFGSC 
to stand by its motto: To Deter and Assure.

    Senator Reed. Thank you very much.
    Senator Nelson. Thank you, Senator Reed.
    Senator Sessions.
    Senator Sessions. Secretary Creedon, does DOD agree that 
the 5-year delay in the CMRR is acceptable?
    Ms. Creedon. Yes, sir. We looked at the budgetary 
constraints. We looked at the requirements for pits. We looked 
at the relative conditions of the two buildings, and looked at 
some of the efficiencies that actually NNSA has identified, and 
decided that we can't build two--there's not enough money to 
build the two buildings concurrently and the most critical----
    Senator Sessions. I know that. You're saying we don't have 
the money.
    Ms. Creedon. We don't have the money.
    Senator Sessions. You had a requirement. Has the 
requirement for 50 to 80 pits per year changed?
    Ms. Creedon. No, sir, that requirement has not changed. But 
the timing of when we need 50 to 80 pits has also moved.
    Senator Sessions. But you had a requirement to have the 50 
to 80 pits within a time period that's no longer going to be 
met, is that right?
    Ms. Creedon. That's true.
    Senator Sessions. That's basically what I was asking. So 
you have a requirement. We've run out of money and now you say 
we've changed, and it's not meeting the requirement we had just 
recently. So this worries me.
    Isn't it true, and I'm not sure I should get our military 
people involved in this, but, Admiral Benedict, is it true the 
budget would result in a 2-year delay of the B61 LEP, moving 
the production from 2017 to 2019? Or is that General Kowalski?
    Admiral Benedict. Senator, that's the Air Force.
    Senator Sessions. All right.
    General Kowalski. Senator, yes, it does delay it from 2017 
to 2019. But that's still consistent with the lifetime of the 
current modifications of the B61 that we have out in the 
fielded force.
    Senator Sessions. Is it true the budget would delay the 
completion of the W76 by 4 years and the Navy, in response, has 
publicly expressed concern? Is that right, Admiral Benedict?
    Admiral Benedict. Sir, as I explained earlier, it will 
delay the final numbers, which are my hedge requirements, by 3 
years, but the operational requirement numbers will be met on 
the baseline schedule.
    Senator Sessions. Did the Navy express concern at one 
point?
    Admiral Benedict. Yes, sir, the Chief of Naval Operations 
did.
    Senator Sessions. Is it true this budget would delay the 
previously agreed-to schedule for the W78-W88 by 3 years, to 
2023?

  STATEMENT OF MAJ. GEN. WILLIAM A. CHAMBERS, USAF, ASSISTANT 
      CHIEF OF STAFF FOR STRATEGIC DETERRENCE AND NUCLEAR 
                  INTEGRATION, U.S. AIR FORCE

    General Chambers. Yes, Senator, that's true.
    [The prepared statement of General Chambers follows:]
       Prepared Statement by Maj. Gen. William A. Chambers, USAF
                              introduction
    Chairman Nelson, Ranking Member Sessions, distinguished members of 
the subcommittee, thank you for the opportunity to discuss your Air 
Force's strategic forces.
    As Assistant Chief of Staff for Strategic Deterrence and Nuclear 
Integration, my team, on behalf of the Chief of Staff, leads planning, 
policy development, advocacy, integration, and assessment for the 
airmen and the weapon systems performing Nuclear Deterrence Operations, 
a core function of our U.S. Air Force. Continuing to Strengthen our 
nuclear enterprise remains an Air Force priority, in fulfillment of the 
President's mandate that, as long as nuclear weapons exist, the United 
States will maintain a safe, secure, and effective arsenal.
    The Strategic Guidance announced by the President and Secretary of 
Defense on the 5th of January states, ``U.S. forces will be capable of 
deterring and defeating aggression by any potential adversary.'' It 
continues, ``Credible deterrence results from both the capabilities to 
deny an aggressor the prospect of achieving his objectives and from the 
complementary capability to impose unacceptable costs on the 
aggressor.''
    Maintaining the credibility of our strategic deterrent requires a 
long-term commitment to our nuclear capabilities, through sustainment, 
investments in modernization, and eventual recapitalization. Most 
importantly, it requires deliberate development of the precious Human 
Capital required to maintain and operate our nuclear forces, and 
leading-edge Intellectual Capital to provide the innovative thinking 
that the 21st century security setting demands. The Air Force 
demonstrates such commitment every day.
    In a constrained fiscal environment, the Air Force has made 
investments in the distinctive capabilities we provide to our joint and 
coalition partners. One of the distinct capabilities the Air Force 
provides the Nation is Global Strike, and the Air Force's ability to 
carry and deliver nuclear weapons to hold any target at risk is 
continually exercised under operational conditions. Results continue to 
confirm the readiness and accuracy of such capability. The Air Force 
helps ensure the Nation's worldwide power projection, even in the face 
of growing anti-access and area denial challenges, through funding of 
Air-Sea Battle priorities and through prudent investment in Continuing 
to Strengthen its Nuclear Enterprise.
                         revitalizing thinking
    Every day, about 36,000 airmen in the U.S. Air Force are performing 
Nuclear Deterrence Operations, a mission that remains vital in the 21st 
century. In many respects, the Cold War was fairly simple and mutual 
deterrence with the Soviet Union seemed predictable. As the 2010 
Nuclear Posture Review indicated, ``Russia remains America's only peer 
in the area of nuclear weapons capabilities. But the nature of the 
U.S.-Russia relationship has changed fundamentally since the days of 
the Cold War.'' During the Cold War, we became experts at Sovietology. 
We understood them and they understood us. Today, we have hit fast-
forward in our thinking, seeking that same level of understanding about 
a wide array of potential adversaries and potential proliferators.
    The Chief of Staff of the Air Force has tasked us to, ``Revitalize 
thinking within the Air Force about crisis stability and 21st century 
deterrence dynamics.'' For 21st century deterrence, one size does not 
fit all, and deterrence of near-peers and other nuclear armed states 
requires new thinking and tailored application. Still, deterrence must 
ensure that potential adversaries, both peers and non-peers, lack 
incentive to use their nuclear capabilities. The non-peer case may be 
the most challenging, and our more likely threat. Our power projection 
capabilities must be credible in the eyes of potential adversaries, 
increasingly so in pre-crisis situations and especially in a regional 
context. The assurances and extended deterrence we provide allies 
strengthen our security relationships while supporting our 
nonproliferation goals. Such effects increase in importance in a 
complex, multi-polar environment. The Air Force is focused on these new 
dynamics.
            sustainment, modernization, and recapitalization
    America continues to be a leader in nuclear nonproliferation. In 
fact, since the end of the Cold War, we have retired or dismantled tens 
of thousands of nuclear weapons. The current stockpile has undergone a 
75-percent reduction since the fall of the Berlin Wall. While our 
arsenal size declines, the commitment to sustainment and modernization 
grows. This is not a paradox. The importance of each individual weapon 
increases as overall numbers go down; every weapon system and every 
warhead must be reliable. The fiscal year 2013 President's budget 
submission makes hard choices, appropriate to our constrained fiscal 
environment, but continues to invest in the enduring and compelling 
attributes the Nation needs from its Air Force deterrent forces.
    We have a plan for two decades of sustainment and modernization to 
keep Minuteman III viable and credible until 2030. To prepare for 
beyond 2030, the Air Force has begun a Capability-Based Assessment and 
Initial Capabilities Document for a successor program, Ground Based 
Strategic Deterrence (GBSD). The DOD is preparing to begin a GBSD 
Analysis of Alternatives to study the full range of concepts to 
recapitalize the land-based leg of the Triad.
    The recent Strategic Guidance also states that ``. . . while the 
U.S. military will continue to contribute to security globally, we will 
of necessity rebalance toward the Asia-Pacific region.'' Our ability to 
project power and hold targets at risk despite adversary employment of 
anti-access and area denial strategies is driving our choices in bomber 
force programs reflected in the President's budget submission.
    The B-52 continues to provide critical stand-off capability and 
will be sustained until a replacement capability comes on line. We are 
accepting some risk in B-52 modernization in order to apply resources 
to ensure the B-2, our only long-range direct-strike asset, remains 
capable of penetrating in an anti-access and area denial environment. 
The combined capabilities of these bombers directly support our power 
projection requirements.
    Over time, our ability to hold targets at risk with current 
technologies and systems will diminish. The nuclear-capable Long-Range 
Strike Bomber is a Department of Defense commitment to address that 
eventual shortfall. We remain committed to delivering a force of 80-100 
new bombers starting in the mid-2020s.
    We currently have service life extension programs in progress for 
the Air Launched Cruise Missile to ensure its viability beyond 2030; 
such programs include the propulsion system, guidance and flight 
control systems, and warhead arming components. In the fiscal year 2013 
President's budget, the program for its replacement, the Long-Range 
Standoff (LRSO), was delayed until fiscal year 2015 as part of the 
adjustments necessary in our constrained fiscal environment. However, 
the LRSO Analysis of Alternatives, which began in August 2011, 
continues apace and is scheduled to be completed in early fiscal year 
2013. Despite the LRSO delay, there will not be a gap between ALCM and 
LRSO.
    The B61 is an aging weapon, originally designed and built in the 
1960s. Though they remain ready and reliable, some warheads in our 
current stockpile date back to 1978. Without refurbishment of key 
components, it will continue to age and eventually will not meet the 
requirements for a safe, secure and effective nuclear deterrent. The 
Department has fully funded the Air Force portion of the B61 Life 
Extension Program, which will deliver the first production unit at the 
end of fiscal year 2019. The B61 is critical to bomber viability, 
deterrence of adversaries in a regional context, and support of our 
extended deterrence commitments.
    To fund these high priority programs, the Air Force had to make the 
hard decision to restructure programs with unacceptable cost growth and 
technical challenges. Last year, we briefed you about initial steps we 
were taking to replace the UH-1N Huey helicopters, under a program 
called the Common Vertical Lift Support Program (CVLSP). Prioritization 
of available funding demands difficult choices, and as a result, the 
CVLSP has been deferred. UH-1N Huey helicopters will continue to 
operate and support the nuclear security mission. We made other 
investments in missile security to reduce the risk of meeting 
requirements. In the United States, we installed Remote Visual 
Assessment cameras at our Minuteman III Launch Facilities and started 
installing Remote Targeting Engagement Systems at our nuclear storage 
locations. We also recently began a $14.4 million Military Construction 
project to build a new security forces training facility at Camp 
Guernsey, WY. In addition, U.S. and the North Atlantic Treaty 
Organization funds are producing security upgrades for weapon storage 
sites in Europe.
    One critical capability that underpins our deterrent forces is 
nuclear command, control, and communications, otherwise known as NC3. 
NC3 underpins U.S. nuclear deterrence and provides our Nation's leaders 
with the means to manage and employ a wide range of strategic options 
for rapid power projection. It is especially important with lower force 
structure numbers. The Air Force is entrusted with a major portion of 
our Nation's NC3 systems, and many of these systems are nearing the end 
of their lifecycles. Constrained budgets and increasing system 
complexity require us to pay special attention and use innovative 
management and program oversight. Over the past 2 years, the Air Force 
has developed strong links with all the other key NC3 stakeholders 
throughout the government, codified Air Force NC3 roles and 
responsibilities, and prioritized near-term NC3 programs for 
investment.
                           nst implementation
    A little over a year ago, the New START treaty (NST) entered into 
force, giving us until 5 February 2018 to meet our obligations to 
reduce and limit our strategic forces to meet the NST's central limits. 
To ensure the activities needed to achieve an intercontinental 
ballistic missile (ICBM) and heavy bomber force compliant with NST's 
central limits, the Air Force has fully funded NST implementation with 
$20.1 million in fiscal year 2013 and an additional $50.6 million 
through the Future Years Defense Program. Implementation activities are 
underway including the reduction of systems no longer used to perform 
the nuclear mission. This includes the elimination of 39 heavy bombers 
in storage at Davis-Monthan Air Force Base and an environmental study 
to eliminate 103 empty ICBM silos. We are also looking at methods to 
convert some B-52Hs from dual-use mode to a conventional-only 
capability.
                             human capital
    A safe, secure, and effective nuclear deterrent for the 21st 
century requires top-notch people dedicated to uncompromising 
stewardship. We are institutionalizing fixes and developing an enduring 
culture of self-assessment to Continue to Strengthen the nuclear 
enterprise. Increasing pass rates and leveling of repeat deficiencies 
during Nuclear Surety Inspections indicate success in this endeavor. 
Root cause analysis is embedded into process improvements in our 
enhanced nuclear inspection program and in initiatives to improve unit 
performance. Over the past 3 years, root cause analysis led to several 
structural, procedural, and process improvements.
    As part of our culture of self-assessment, we continue to refine 
our organizational constructs, an example being the successful transfer 
of CONUS munitions squadrons from Air Force Materiel Command to Air 
Force Global Strike Command.
    We are also committed to the professional development of our airmen 
through new formal training programs and more deliberate developmental 
education, all designed not only to bring airmen up to date quickly on 
the current issues within the nuclear enterprise, but also to foster 
the critical thinking necessary for the 21st century security setting.
                                closing
    The Air Force provides two legs of our nuclear Triad and extended 
deterrence for allies and partners for a relatively low cost. Nuclear 
Deterrence Operations amount to 4.6 percent of the total Air Force 
budget, about 1 percent of the total Department of Defense budget.
    As events over the past year demonstrate, the United States does 
not get to choose the timing or location of a crisis. Having ready, 
diverse, and resilient capabilities to ensure stability during crises 
remains very important. The attributes of the Air Force's deterrent 
forces--the responsiveness of the ICBM and the flexibility of the 
bomber--underwrite the Nation's ability to achieve stability in the 
midst of the crises and challenges of the next few decades.
    The President's budget submission makes hard choices, but retains 
the commitment to strong deterrent capabilities through modernization 
and recapitalization programs. That commitment is made manifest every 
day by the 36,000 airmen performing deterrence operations, 
demonstrating those capabilities, and doing it with precision and 
reliability. They are trustworthy stewards of our Nation's most 
powerful weapons, still needed to project power, to deter and assure in 
the 21st century.

    Senator Sessions. Is it true the budget does not provide 
the resources necessary to meet a DOD requirement for 
developing pit production capacity to 50 to 80 pits that you 
had previously declared would be for 2022? You'll not meet that 
goal?
    Ms. Creedon. Sir, that's correct. But because of what 
General Chambers has said, the actual time when that 
requirement becomes an essential requirement has also slipped.
    Senator Sessions. The Navy, Admiral Benedict, previously 
had stated that the schedule for the SSBN, the new Ohio 
replacement, and the 12 follow-ons, 12 of them, is 
``inextricably linked to the legacy Ohio-class SSBN 
requirements,'' and that there is ``no leeway in this plan to 
allow a start or any delay in the procurement plan.'' Did the 
Navy make that statement in previous years to your knowledge?
    Admiral Benedict. Sir, I don't know who made that 
statement, sir.
    Senator Sessions. You didn't make that statement?
    Admiral Benedict. No, sir.
    Senator Sessions. You'd remember, I know. But that's the 
information I have.
    Admiral Benedict. Yes, sir.
    Senator Sessions. So I'm just saying, gentlemen, one thing 
sometimes in uniform you don't focus on and maybe you 
shouldn't, but the problem is that when you keep moving things 
to the right all of them don't get completed. If you don't get 
started and you don't do them and Congress comes along or some 
other problem or something, the next thing you know a program 
that was designed to be completed isn't ever completed, number 
one; number two, you don't really save $4 billion when you move 
a submarine 1 year, or $8 billion when you move it 2 years. 
What you do is you create a hole that has to be filled because 
you spent that money on something else.
    So we have to have from you realistic testimony concerning 
the threat. I'm going to take you at your word based on what I 
know today, but fundamentally what I'm saying is when we keep 
moving things to the right we're endangering our defense 
capability, and I'm worried about it. It's for one reason. As 
Admiral Mullen said, the debt is a great threat to our national 
security. So we have money shortages.
    Then I also have to say that I'm uneasy because this 
administration has not been strongly committed on the strategic 
issues, whether it's national missile defense or whether it's 
nuclear weapons. The President said recently that we have more 
weapons than we need, and General Chilton, when asked about 
this by Senator Feingold in 2010, said: ``I do not agree that 
it is more than needed. I think the arsenal that we have is 
exactly what is needed today to provide the deterrent.''
    So I think the President better communicate with DOD to 
make sure that he knows what he's saying. He's proposed and 
openly and repeatedly stated he's in favor of moving to a world 
without nuclear weapons.
    So this makes me concerned that our nuclear triad submarine 
is being delayed, modernization is being delayed, that 
agreements we thought we had are not being followed. So that's 
the problem, Mr. Chairman. I know it's a challenge, but these 
issues are so important that I do feel like I should express 
them.
    Senator Nelson. Thank you, Senator Sessions. I think we're 
all concerned about slippage on timeframes, because it can slip 
right into the future, and we all know that the future doesn't 
become the present and will remain the future, obviously. 
That's what our concern is.
    Then when it comes to the CMRR and the building, not having 
enough to construct both buildings, with respect to the 
STRATCOM headquarters, we have phased-in or incremental 
funding. Has DOD looked at incremental funding? Because once 
you start the building it's not going to finish in a single 
year, but you could get at least started?
    I think the fear is that it'll just keep going, slipping 
off into the future. In the next budget, there won't be 
anything; there will be other reasons. It looks like we have a 
plan for fiscal year 2013. What's the plan for fiscal year 2014 
and beyond?
    I guess any one of you that might want to respond to 
phased-in or incremental funding would be fine with me.
    Ms. Creedon. Senator, unlike DOD, where incremental funding 
is the exception to the rule, the way the budget is structured 
at NNSA, the construction projects are always incrementally 
funded. So the NNSA budget is built in a way that, particularly 
because NNSA tends to do very large, one-of-a-kind, first-of-a-
kind, technically complex, very expensive buildings, that you 
couldn't possibly fund, nor do you need all that money in 1 
year because they take so long to build. NNSA is always 
incrementally funded.
    So the uranium processing facility, the money for that that 
starts in 2013, assuming that it's appropriated, but it's 
requested over a period of years and we hope that it will be 
appropriated over a period of years.
    Senator Nelson. Wouldn't it be possible to get started with 
the planning or some of the basic requirements that are almost 
always initial funded? I guess everybody seems to be 
concerned--I know General Kehler was concerned, we're all 
concerned--about not having the building. We're concerned about 
slipping, dropping down the number of pits that will be taken 
care of. So we don't just slide way off into the future, I 
would hope that maybe with what Senator Cornyn was saying about 
getting together and looking at other ways to do this, to find 
a way to put us into a position to begin moving forward.
    I know we're not talking about tens of millions. We're 
talking about a lot more money than that. But it does seem that 
that is desirable to at least explore.
    I have a question here. Admiral Benedict, I understand that 
NNSA is now undertaking a common warhead design for the W88 
Trident D5 warhead and the W78 Minuteman III warhead. Will you 
tell us whether you think it's possible to have a single 
warhead for both families of missiles and what is the risk to 
the Navy for a common design of sorts?
    Admiral Benedict. Yes, sir. I do believe it is possible and 
the Navy does support that program. Right now it is envisioned 
that the Air Force would lead that and we would be in a 
supporting role as that effort rolls out.
    As in any program right now, which it's in the initial 6.1 
phase of development, there are programmatic and technical 
challenges which we are exploring today. I do believe that it 
is the intention of DOD to go to NWC in fiscal year 2012 and 
ask for permission, authorization to proceed to phase 6.2, at 
which time we would go into further development and design 
understanding.
    Of course, in this type of a program a common warhead will 
need to be able to meet both the Navy requirements for the SLBM 
as well as the Air Force requirements for the ICBM. That's 
never been done before. I do believe that, given the right time 
and talent, we can achieve those requirements, sir.
    Senator Nelson. Thank you.
    General Kowalski, what impact will delaying the 
installation of the B-52 CONECT system have? I understand it 
was to provide a digital backbone for the B-52 and provide 
rapid retargeting recognizing moving from analog to digital. 
What will that involve?
    General Kowalski. Mr. Chairman, the B-52 combination of its 
extremely long range--it has the longest range of any of our 
bombers--along with the wide variety of munitions it carries--
it has the widest variety of any of our bombers--makes it 
extremely well-suited for the role of a standoff weapons 
platform, especially in the more high-end conflict, where we're 
going against a denied air space environment with this 
proliferation we have of anti-access and area denial kinds of 
weapons.
    So as we think about what that joint force looks like, we 
need that standoff platform to be fully integrated into that 
joint force, meaning that we can communicate to it and pass it 
information related to threats, related to retargeting, et 
cetera, as it moves to be able to access global targets. So 
that requires beyond line-of-sight communication.
    So that digital backbone is going to be important as we 
think about the future employment of the B-52. The reality that 
we're in is that the combination of budget pressures and 
problems with the program has caused us to restructure the 
CONECT system. We've separated it from the AEHF part of that, 
the AEHF radio and communications systems, and we are looking 
now at options to bring it back in.
    The bottom line is the requirement for that capability 
remains and we're going to continue to advocate for it.
    Senator Nelson. Should the requirement remain to do the 
CONECT as well?
    Admiral Benedict. The requirement remains for that kind of 
capability. So as we go through and we look at the funding that 
we have for 2013 and we look at what we can get outside of 2013 
for the rest of the program, we'll be able to come back with a 
better answer. But right now we're reviewing all our options.
    Senator Nelson. Senator Sessions, I notice the time. Do you 
have some more?
    Senator Sessions. I really don't. I thank all of you for 
your excellent testimony and service to the country. I believe 
that all of us in Congress need to examine carefully the 
financial restraints that are falling on this part of our 
strategic forces. It's a key component of our strategic forces 
and as we make choices, difficult choices, I don't think we 
need to allow too much to fall on this aspect of our defense 
posture.
    Thank you, Mr. Chairman.
    Senator Nelson. Thank you, Senator Sessions.
    Let me add my thoughts. We ask you to reduce budgets, to 
watch the growth, and then when you come before us after you've 
done it, then we question why you've done it and whether you've 
done it right or not. But thank you for your explanations. We 
appreciate it very much. Thank you for your service. We are 
adjourned.
    [Questions for the record with answers supplied follow:]
           Questions Submitted by Senator E. Benjamin Nelson
                    w-76 warhead refurbishment delay
    1. Senator Nelson. Admiral Benedict, I understand the National 
Nuclear Security Administration (NNSA) has delayed the rate of 
refurbishment of the W-76 Trident D-5 warhead. Can you please explain 
what is the delay and how does this impact the risk to the fleet?
    Admiral Benedict. In order to fund the B61 refurbishment, NNSA has 
decremented its Directed Stockpile Work budget. The W76-1/Mk4A is one 
of the donor programs. The production period has been extended by 3 
years, but the NNSA has committed to meeting the Navy SSBN fleet 
operational requirements by 2018 and the remaining assets will be 
delivered by 2021. This is consistent with Navy fleet needs and 
Strategic Systems Programs (SSP) Strategic Weapons Facility planning 
requirements.

                     delay of the ohio replacement
    2. Senator Nelson. Admiral Benedict, I understand the Ohio 
replacement will be delayed by 2 years. Can you explain how this 
impacts the Common Missile Compartment (CMC) program you manage with 
the British and how old the first Ohio-class boat will be when it is 
retired?
    Admiral Benedict. PB13 has sufficient resources for the Navy to 
maintain the CMC and Strategic Weapon System (SWS) design efforts on a 
schedule that supports the United Kingdom (U.K.) Successor program. The 
2-year delay to the U.S. Ohio replacement lead ship will slow rest-of-
ship design activities, however, systems and interfaces affecting the 
CMC design will be sufficiently mature to deliver a CMC design package 
to U.K. for construction. The U.K. will now lead the United States and 
be first to construct a CMC, integrate a SWS, and launch a Trident II 
(D5) missile from a CMC. The United States is working closely with the 
U.K. to mitigate U.K. first-use risks by prototyping and proofing CMC 
construction techniques and test programs. Maximum use of U.S. First 
Article prototypes and SWS Ashore facilities will mitigate risk shifted 
to the U.K. program.
    The Ohio-class SSBNs begin retiring in 2027 following their 42 year 
extended service life. The Ohio-class will then retire at a rate of one 
per year with the first Ohio replacement SSBN entering strategic 
service as the fifth Ohio retires.

                   conventional prompt global strike
    3. Senator Nelson. Admiral Benedict, the Department of Defense 
(DOD) has been researching delivery methods to strike targets using 
conventional warheads several thousand miles away in less than an hour. 
Is the Navy participating in this?
    Admiral Benedict. The Navy does not have a requirement or program 
of record to develop a sea-based Conventional Prompt Global Strike 
(CPGS) capability and has not requested funds in the President's budget 
for fiscal year 2013 for CPGS. However, the Navy has provided subject 
matter expertise, including conceptual solutions, to the Office of the 
Secretary of Defense for Acquisition, Techology, and Logistics-led CPGS 
working group.

                            w-78/88 warheads
    4. Senator Nelson. Admiral Benedict, I understand that NNSA is now 
undertaking a common warhead design for the W-88 Trident D-5 warhead 
and the W-78 Minuteman III warhead. Do you think it is possible to have 
a single warhead for both families of missiles and what is the risk to 
the Navy in this common design?
    Admiral Benedict. A W88/Mk5 Reentry Body is composed of an 
Aeroshell, electronics, non-nuclear components and a Nuclear Explosives 
Package (often referred to as a warhead). It is not possible to have a 
common reentry body for both the Trident D5 missile and the Minuteman 
III missile systems. It is theoretically possible to design a Nuclear 
Explosives Package that, with adaptable mounting hardware, could be 
fielded in both the W88/Mk5 Aeroshell and the W78/Mk12A Aeroshell. 
Preliminary concept studies have indicated potential designs to meet 
this purpose. However, all designs which have their qualification basis 
in underground test require new pit production to meet both the Air 
Force and Navy inventory requirements. Current and foreseeable future 
pit production capacity is far short of what would be needed to support 
any of these concepts within service timeline requirements.

                          b-52 connect system
    5. Senator Nelson. General Kowalski, I understand the B-52 connect 
system was to provide a digital backbone for the B-52 and provide rapid 
retargeting. What impact will delaying the installation of the B-52 
connect system have?
    General Kowalski. [Deleted.]

                             uh-1n program
    6. Senator Nelson. General Kowalski, what impact will the delay of 
replacing the UH-1N have on your missile field operations?
    General Kowalski. Air Force Global Strike Command (AFGSC) is 
committed to providing the strongest security measures possible using 
available resources. The UH-1N continues to be a reliable helicopter 
but capability gaps complicate missile field security operations. AFGSC 
is mitigating risks with the current fleet by putting a UH-1N response 
force on alert, pursuing low-cost UH-1N modernization, and revising our 
security concept-of-operations to take full advantage of other security 
enhancements we have made to include the Remove Visual Assessment 
cameras at our launch facilities. However, we will continue to advocate 
for replacement to the UH-1N that meets DOD's mandated requirement for 
speed, range, and payload.

    7. Senator Nelson. General Chambers, is the replacement for the UH-
1N canceled or deferred. It is not clear from the budget documents.
    General Chambers. The Air Force program to replace to UH-1N 
helicopter, now referred to as the Common Support Helicopter, is 
deferred. Budget constraints prevented the Air Force from funding the 
previously proposed Common Vertical Lift Support Platform and is 
currently reexamining options to initiate a new acquisition strategy to 
fulfill the requirement for vertical lift in the missile fields and the 
National Capital Region. In deferring the UH-1N replacement, the Air 
Force is committed to mitigating risk while it pursues new means to 
meet the requirement. Until a long-term replacement is possible, the 
Air Force will work to mitigate aircraft safety and capability gaps.

             b-2 advanced extremely high frequency terminal
    8. Senator Nelson. General Kowalski, I understand that the terminal 
for connecting the B-2 to the Advanced Extremely High Frequency (AEHF) 
Satellite has either been delayed or canceled. This is to provide 
secure nuclear command, control, and communications (NC3). What impact 
will that have on your B-2 fleet?
    General Kowalski. [Deleted.]

              nuclear command, control, and communications
    9. Senator Nelson. General Chambers, what is the Air Force doing to 
assess and modernize its NC3 network?
    General Chambers. In July 2011, the Chief of Staff of the Air Force 
directed the Air Force to evaluate its NC3 requirements, and modernize 
lagging infrastructure to ensure credible, reliable, and survivable 
nuclear command and control. To that end, the Air Force has made 
significant strides in assessing and modernizing its NC3 network. For 
example, Phase IV of the Air Force's Comprehensive Assessment of 
Nuclear Sustainment conducted an in-depth survey of NC3. Regarding 
modernization, the Air Force is currently focused on AEHF and Very Low 
Frequency capability for our bomber fleet through the Family of Beyond 
Line-of-Sight Terminals (FAB-T) and the Common Very Low Frequency 
Receiver, respectively. By July 2012, we will complete the 
cryptographic modernization of the Strategic Automated Command and 
Control System, our fastest, most reliable NC3 communications system, 
extending its service life to 2030. We are also exploring materiel 
options to upgrade the Low Frequency/Very Low Frequency transmitter on 
the National Airborne Operations Center. Additional modernization 
upgrades include the Minuteman MEECN Program Upgrade (MMPU), which will 
deliver AEHF connectivity to our ICBM fleet, and the Global Aircrew 
Strategic Network Terminal (Global-ASNT), which will deliver both AEHF 
and VLF to our nuclear command posts.

                       slip in b-61 gravity bomb
    10. Senator Nelson. General Chambers, I understand the B-61 gravity 
bomb refurbishment has slipped from coming on line by 2 years to 2019. 
Can you explain why this slip occurred; was it on the Air Force end or 
the NNSA end?
    General Chambers. The NNSA requested and the Nuclear Weapons 
Council (NWC) approved a 2-year delay in the First Production Unit 
(FPU) of the B61. The NNSA provided analysis showing critical B61 
limited life components have longer lives than originally estimated and 
U.S. Strategic Command (STRATCOM) has confirmed that a fiscal year 2019 
FPU will meet their requirements.
                                 ______
                                 
              Questions Submitted by Senator Jeff Sessions
                             sequestration
    11. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, the Budget Control Act (BCA) requires 
DOD in January 2013, to reduce all major accounts over 10 years by a 
total of $492 billion through sequestration. This will result in an 
immediate $55 billion reduction to the fiscal year 2013 DOD program. 
The Secretary of Defense has stated on numerous occasions that the 
impact of these cuts would be ``devastating'' and ``catastrophic,'' 
leading to a hollow force and inflicting serious damage to our national 
defense. Yet, the Military Services must begin this month with some 
type of guidance on developing a Service budget for fiscal year 2014. 
What are some of the specific anticipated implications of sequestration 
to DOD nuclear programs and the modernization of the nuclear triad?
    Ms. Creedon, Mr. Weber, General Kowalski, and Admiral Benedict. If 
triggered, sequestration would indeed have a profound impact across 
DOD, and nuclear programs would be no exception. At this time, no 
analysis on specific programmatic impacts is available.

    12. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, what programs would have the most 
significant impact to operations or readiness?
    Ms. Creedon, Mr. Weber, General Kowalski, and Admiral Benedict. If 
sequestration occurs, automatic percentage cuts are required to be 
applied without regard to strategy, importance, or priorities, which 
would impact almost every program within DOD.

    13. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, would sequestration lead to a contract 
cancellation, termination, cost increases, or schedule delays?
    Ms. Creedon, Mr. Weber, General Kowalski, and Admiral Benedict. A 
sequester could disrupt thousands of contracts and programs.

    14. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, is DOD currently conducting any 
planning in your areas of responsibility? If so, can you describe the 
plan?
    Ms. Creedon, Mr. Weber, General Kowalski, and Admiral Benedict. DOD 
is not currently preparing for sequestration, and the Office of 
Management and Budget (OMB) has not directed agencies, including DOD, 
to initiate plans for sequestration.

    15. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, how will you assess the risk of each 
cut?
    Ms. Creedon, Mr. Weber, General Kowalski, and Admiral Benedict. DOD 
is not planning for such an event; hence, it would be premature to 
attempt to assess the risk of sequestration.

    16. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, has any planning commenced to date to 
assess the impact of such sequestration reductions, such as 
prioritizing programs in preparation for reprogramming actions or 
terminations?
    Ms. Creedon, Mr. Weber, General Kowalski, and Admiral Benedict. DOD 
is not currently preparing for sequestration, and OMB has not directed 
agencies, including DOD, to initiate plans for sequestration.

                   solid rocket motor industrial base
    17. Senator Sessions. Admiral Benedict, during our hearing last 
year you told us that the unit cost for Submarine Launched Ballistic 
Missile (SLBM) motors had increased in cost from approximately $10.7 
million in fiscal year 2011 to approximately $19.2 million in fiscal 
year 2012, an $8.5 million increase. Has anything improved over the 
past year to address the fragility of the solid rocket motor (SRM) 
industrial base?
    Admiral Benedict. SSP has proactively worked with their prime 
missile contractor, Lockheed Martin (LM), and SRM subcontractor, 
Alliant Techsystems (ATK), to respond to the eroding business base for 
large rocket motors and take steps to reduce the infrastructure and 
personnel at both of ATK facilities in Utah. Over the past few years 
SSP has engaged LM and ATK senior leadership to review and develop 
action plans to reduce overhead costs and minimize cost increase. As a 
result, ATK has significantly (up to 50 percent) reduced its workforce 
in line with future production demands. Moreover, in an effort to 
reduce its physical infrastructure, ATK has shut down many buildings 
within its Bacchus and Promontory campuses to consolidate operations. 
SSP has engaged LM and ATK leadership to address: required 
requalification to minimize production disruptions; retention of 
critical skills and safety disciplines during downsizing/consolidation 
of ATK operations; reduction in ATK overhead costs; and viability of 
sub-tier suppliers for critical materials. As a result of these 
actions, the Navy has lowered the projected SRM unit cost in the 
President's budget request for fiscal year 2013 approximately $1.6 
million per year. The fragility of the SRM industry is still a concern. 
Despite efforts to reduce overhead costs, the SRM industrial base 
remains volatile. National Aeronautics and Space Administration's 
(NASA) decision to consider SRM for Space Launch System (SLS) 
applications has a stabilizing impact on industry for the time being. 
The next key milestone is in 2015 when NASA has to make a decision on 
the Advanced Booster System. If NASA decides to exit SRM industry for 
SLS booster application, it will have a significant cost impact on Navy 
and other DOD programs.

    18. Senator Sessions. Admiral Benedict, is there more that should 
be done to ensure that NASA and DOD approach this issue together from a 
whole-of-government perspective?
    Admiral Benedict. NASA programs have been a key contributor to the 
viability of the SRM industrial base. During the last several years, 
there has been significant cooperation among SSP and NASA to jointly 
study and address this issue. Both programs have been part of the 
Interagency Task Force for the past few years and, recently, SSP has 
jointly worked with NASA to complete a Cost Sensitivity Study. Although 
basic design and application is different for Fleet Ballistic Missile 
and Space Exploration, SSP and NASA deal with the same SRM vendors and 
have many common sub-tier suppliers. NASA decisions have strong 
implications for the FBM program. It is worth noting that two shuttle-
like rocket motors are roughly equivalent to 20 Trident II D5 motor 
sets.
    SSP is actively participating in the recently started National 
Institute for Rocket Propulsion Systems (NIRPS), a NASA led effort 
focused on addressing the needs of U.S. solid and liquid rocket 
propulsion capabilities to promote resilience of the industrial base. A 
combined U.S. Government strategy involving NASA and DOD (including Air 
Force, Navy, and Missile Defense Agency (MDA) is imperative where both 
departments can jointly define future production and development needs 
in order to provide stability for this industry that depends on U.S. 
Government business.

    19. Senator Sessions. Admiral Benedict, concern of the past has 
involved costs driven up by overhead costs tailored to meet a demand no 
longer necessary with the end of the shuttle program. Do you believe 
the industrial base today is appropriately sized?
    Admiral Benedict. The current SRM industrial base is adequately 
sized to meet all U.S. Government demands. Less than 2 decades ago 
there were five major SRM vendors. Today, there are only two large 
motor manufacturing companies--ATK and Aerojet. This was a major 
industry adjustment driven by the space commercial market that helped 
keep costs under control. Right-sizing of facilities and workforce has 
been going on for over a decade at Aerojet. ATK has recently taken 
numerous steps to right size its capacity after completion of the NASA 
Shuttle program. This included a significant reduction in workforce and 
consolidation of buildings and work centers. The SRM industry continues 
to make progress and SSP is working proactively with industrial 
partners to reduce overhead costs and help industry to right size, 
keeping in mind our future needs.

    20. Senator Sessions. Secretary Creedon, Secretary Weber, General 
Kowalski, and Admiral Benedict, while demand today is low, our long-
term need for SRMs is not going away any time soon, especially with 
respect to strategic missile and future follow-on Intercontinental 
Ballistic Missile (ICBM) and SLBM programs. If we were to let the 
temporary lapse in the SRM base take place, how much do you anticipate 
it would cost to restart that industrial base in the future?
    Ms. Creedon and Mr. Weber. DOD has not developed a cost estimate to 
restart the industrial base from a cold start. DOD does not expect 
there to be a lapse in the SRM industrial base. The SRM industrial base 
has been on a steady decline for the last 2 decades and remains an area 
of concern for DOD. The completion of Minuteman III and Shuttle SRM 
production and the cancellation of both the MDA's Kinetic Energy 
Interceptor (KEI) and NASA's Constellation programs have dramatically 
decreased demand for SRM. Last year, DOD submitted a SRM Industrial 
Base Sustainment Plan (April 4, 2011) to Congress as required by 
section 1078 of the National Defense Authorization Act for Fiscal Year 
2010, Public Law 111-84. DOD's primary objectives for the SRM 
Industrial Base Sustainment Plan were to: (1) sustain production 
capabilities for national assets; (2) keep critical design teams in 
place for future system needs; and (3) to the extent practical, 
preserve the option to satisfy new government demand in the future. 
After careful analysis, DOD concluded that it could achieve its 
sustainment goals through a combination of initiatives. DOD needs 
industry to take the lead by right-sizing its excess capacity to align 
with projected demand. DOD must invest in SRM science and technology 
(S&T) and research and development (R&D), along with adequate 
production that will sustain the base. Currently, the Navy's Trident II 
D5 missile is the program of significance sustaining the large SRM 
production capability. The S&T program includes the Integrated High 
Payoff Rocket Propulsion Technology (IHPRPT) program, and the R&D 
programs include the Air Force Propulsion Application Program (PAP), 
and the proposed Air Force Minuteman III SRM modernization program.
    General Kowalski. I defer to Secretary Creedon to address the 
question in that she is more familiar with the details of this matter.
    Admiral Benedict. SSP has kept a low optimum production rate of 12 
motor sets a year since 1999 in order to provide affordable stability 
in the strategic industrial base and to maintain unique critical skills 
and production capabilities. The Navy must continue rocket motor 
production in order to support D5 deployment through 2042 because most 
of the currently inventoried D5 rocket motors will age out before then. 
The Navy uses unique Class 1.1 high energy propellant instead of the 
Class 1.3 propellants typically used by the Air Force and NASA. High 
energy Class 1.1 propellant is necessary in order to meet range and 
performance requirements, as well as deployment on a volume-
constrained, manned launch platform. The Fleet Ballistic Missile (FBM) 
propellants have mechanical properties far superior to any Class 1.3 
propellant for reasons of long life, damage tolerance, and reliability 
for underwater launch from manned platforms.
    In SSP's assessment, given the current industrial base environment, 
if D5 rocket motor production is gapped or stopped, there will be 
significant costs associated with the restarts. Cost drivers will 
include resurrecting the infrastructure with unique skills required and 
reestablishing the supply chain. Depending upon the length of the 
lapse, it could take 5 to 10 years to restart D5 rocket motor 
production with an associated cost of several billion dollars.

            family of advanced beyond line of site terminals
    21. Senator Sessions. Secretary Creedon, General Kowalski, and 
Admiral Benedict, the FAB-T has experienced significant delays, and for 
the third year in a row procurement has had to be deferred to address 
development issues. According to the Government Accountability Office 
(GAO), the program's software development schedule is still unrealistic 
and the Air Force announced that it would be terminating its FAB-T 
contract and seeking alternative providers. How do delays in FAB-T 
impact the efforts to modernize nuclear command and control?
    Ms. Creedon. Further delays in FAB-T will affect efforts to 
modernize NC3; however, the Air Force's current alternate acquisition 
strategy will meet the most pressing requirements for warfighter 
capabilities (e.g., the Command Post Terminals (air/ground) with 
President and National Voice Conferencing (PVNC)) and will provide for 
deferring the bombers and RC-135 capabilities outside the Future Years 
Defense Program. This deferral presents minimal risk. The B-52 
currently has Low Frequency/Very Low Frequency (LF/VLF) capability, and 
the Air Force is developing LF/VLF capability for the B-2 via the 
Common VLF Receiver Program. The RC-135 program is also pursuing an 
alternate solution to FAB-T.
    General Kowalski. I defer to Secretary Creedon to address the 
question in that she is more familiar with the details of this matter.
    Admiral Benedict. The FAB-T is not a SSP. As such, I cannot comment 
on changes to the FAB-T program schedule.

    22. Senator Sessions. Secretary Creedon, General Kowalski, and 
Admiral Benedict, is the Air Force developing contingencies in the 
event FAB-T cannot meet that need date?
    Ms. Creedon. Yes. First, the AEHF system is backwards compatible 
with our existing Milstar command post terminals. Although those 
terminals are aging, and do not have all of the capability of the FAB-
T, we will continue to use their services if FAB-T deliveries are 
further delayed. Second, we just released the Request for Proposals to 
develop in parallel an alternative source for the FAB-T capability. 
This alternative source will be focused on meeting our more urgent, 
near-term need to provide strategic communications. As the program 
matures, we will be able to assess the progress of the alternative 
source and the current FAB-T effort and determine a path forward for 
production.
    General Kowalski. I defer to Secretary Creedon to address the 
question in that she is more familiar with the details of this matter.
    Admiral Benedict. The FAB-T is not a SSP. As such, I cannot comment 
on changes to the FAB-T program schedule.

    23. Senator Sessions. Secretary Creedon, General Kowalski, and 
Admiral Benedict, what is being done to address FAB-T affordability and 
should requirements be reexamined?
    Ms. Creedon. Air Force Space Command recently completed a thorough 
review of the FAB-T requirements and will brief the results to the 
Joint Requirements Oversight Council. Due to the critical Nuclear 
Command and Control mission FAB-T supports, we did not find any 
significant areas where we could reduce requirements without 
unnecessarily increasing risk. We did clarify the priority of 
requirements to allow our acquisition community more flexibility in 
delivering that capability. We believe this will lead to an affordable 
solution, and we will seek production proposals from our current 
contractor and from alternative sources this summer to validate those 
costs.
    General Kowalski. I defer to Secretary Creedon to address the 
question in that she is more familiar with the details of this matter.
    Admiral Benedict. The FAB-T is not a SSP. As such, I cannot comment 
on the FAB-T program's affordability or its requirements.
                                 ______
                                 
               Questions Submitted by Senator John Cornyn
                      goal of a nuclear-free world
    24. Senator Cornyn. Secretary Creedon and Secretary Weber, in 
December 2010, I opposed ratification of the President's New Strategic 
Arms Reduction Treaty (New START), in part because of serious doubt 
about the President's long-term nuclear weapons policies. The reality 
is that nuclear weapons are proliferating in the world, not going away. 
The Russians maintain a sizeable nuclear arsenal. But, more alarmingly, 
Iran continues to make progress in its pursuit of nuclear weapons, 
North Korea's nuclear weapons program remains a serious threat to 
regional security and stability, and the full extent of the Chinese 
nuclear arsenal is not known. Nuclear weapons exist, and this is not a 
genie that we can put back in the bottle by unilaterally disarming and 
dismantling our nuclear weapons. Yet, all the while, the administration 
is reportedly contemplating deep reductions in U.S. nuclear forces. How 
realistic is the President's goal of a world without nuclear weapons?
    Ms. Creedon and Mr. Weber. As stated in the Nuclear Posture Review 
(NPR) (2010), the conditions that would ultimately permit the United 
States and others to give up their nuclear weapons without risking 
greater international instability and insecurity are very demanding. 
Among those are the resolution of regional disputes that can motivate 
rival states to acquire and maintain nuclear weapons, success in 
halting the proliferation of nuclear weapons, much greater transparency 
into the programs and capabilities of key countries of concern, 
verification methods and technologies capable of detecting violations 
of disarmament obligations, and enforcement measures that are strong 
and credible enough to deter such violations. Clearly, such conditions 
do not exist today, but they are achievable and we must work to create 
those conditions.
    The administration remains committed to the safety, security, and 
effectiveness of the nuclear arsenal as long as nuclear weapons exist. 
As the President stated in 2010, nuclear modernization requires 
investment for the long-term, and, even in light of the new fiscal 
realities of the BCA, the administration continues to pursue these 
programs and capabilities.

    25. Senator Cornyn. Secretary Creedon and Secretary Weber, if 
President Obama were to succeed in eliminating the entire U.S. nuclear 
arsenal, what effect do you think that would that have on the global 
threat picture for the United States?
    Ms. Creedon and Mr. Weber. The President has specified the 
conditions that would need to exist to support a world without nuclear 
weapons. Those conditions would ensure that the United States was not 
accepting undue risk. Clearly, such conditions do not exist today.

                    deeper nuclear force reductions
    26. Senator Cornyn. Secretary Creedon and Secretary Weber, the 
administration is conducting a review of U.S. nuclear deterrence 
requirements, ostensibly to support another round of nuclear arms 
reductions with Russia. It appears, however, that the President has 
already determined that additional reductions are necessary. This past 
weekend, he told an audience in South Korea that he ``can already say 
with confidence that we have more nuclear weapons than we need.'' Yet, 
during consideration of the New START treaty, the then-Commander of 
STRATCOM, General Kevin Chilton, told the Senate, ``I think the arsenal 
that we have is exactly what is needed today to provide the 
deterrent.'' In light of this authoritative statement from a subject 
matter expert on nuclear forces, how can the President subsequently 
conclude that we have more nuclear weapons than we need?
    Ms. Creedon and Mr. Weber. Detailed analysis of potential 
reductions in strategic weapons, conducted in spring 2009 as part of 
the NPR, concluded that the United States could sustain stable 
deterrence with significantly fewer deployed strategic nuclear 
warheads, assuming parallel Russian reductions. The NPR analysis 
considered several specific levels of nuclear weapons, all below 
current levels of approximately 2,200 deployed strategic warheads. Its 
conclusions, concurred in by the Secretary of Defense, the Joint Chiefs 
of Staff, and Commander, STRATCOM, and approved by the President, 
formed the basis for U.S. negotiations with Russia on the New START 
treaty. Because the New START treaty is intended to be only an initial 
step in a continuing process of bilateral nuclear reductions, this 
initial analysis used conservative assumptions to determine acceptable 
reductions in deployed strategic nuclear weapons.
    The administration is conducting an NPR implementation study to 
determine the nuclear force size and structure needed to support U.S. 
national security requirements and meet international obligations in a 
dynamic security environment. The ongoing study was directed by the 
President as part of the NPR of 2010. The analysis from this study will 
provide a basis for the President's guidance to DOD and the Department 
of Energy on nuclear planning with respect to the force structure, 
force posture, and stockpile requirements needed to protect the United 
States and its allies and partners, and to inform plans for the 
employment of nuclear weapons in the event that deterrence fails. As 
stated in the NPR, the United States intends to pursue further 
reductions in nuclear weapons with Russia. When complete, the analysis 
of deterrence requirements and force postures will inform the 
development of any future arms control objectives.

    27. Senator Cornyn. Secretary Creedon and Secretary Weber, we have 
been told that the deterrence relationship between the United States 
and Russia is stable. We've been told that neither side has an 
incentive to strike first in a crisis, and that there is no arms race. 
So, in light of this stability achieved by our current approach, why 
must we reduce below New START levels of 1,550 warheads on 700 
strategic delivery systems?
    Ms. Creedon and Mr. Weber. Even under the New START treaty levels, 
the United States and Russia still have approximately 90 percent of the 
nuclear weapons in the world. Seeking further bilateral reductions will 
not diminish, but rather, strengthen the deterrence and strategic 
stability relationship between the United States and Russia.

    28. Senator Cornyn. Secretary Creedon and Secretary Weber, what 
justifications can you offer for risking national security by altering 
nuclear strategy in pursuit of deeper reductions?
    Ms. Creedon and Mr. Weber. As stated in the 2010 NPR, the United 
States intends to pursue with Russia further reductions in nuclear 
weapons. When complete, the analysis of deterrence requirements that 
was called for in the NPR will inform the development of any future 
arms control objectives. However, several factors will influence the 
magnitude and pace of such reductions:

         First, any future reductions in U.S. nuclear forces 
        must continue to strengthen deterrence of potential regional 
        adversaries, strategic stability vis-a-vis Russia and China, 
        and assurance of our allies and partners.
         Second, implementation of the Stockpile Stewardship 
        Program and the nuclear infrastructure investments recommended 
        in the NPR would allow the United States over time to shift 
        away from retaining large numbers of non-deployed warheads as a 
        hedge against technical or geopolitical surprise, allowing 
        major reductions in the nuclear stockpile.
         Third, Russia's nuclear force will remain a 
        significant factor in determining how much we can reduce U.S. 
        forces and how fast we are prepared to reduce U.S. forces.

    As stated in the NPR, increased investments in the nuclear 
infrastructure and a highly skilled workforce are needed to ensure the 
long-term safety, security, and effectiveness of our nuclear arsenal 
and to support the full range of nuclear security work, including 
nonproliferation, nuclear forensics, nuclear counterterrorism, 
emergency management, intelligence analysis, and treaty verification. 
These investments are essential to facilitating reductions while 
sustaining deterrence under the New START treaty and beyond.
    We can take the practical steps identified in the NPR of 2010 that 
will not only move us toward the ultimate goal of eliminating all 
nuclear weapons worldwide but will, in their own right, reinvigorate 
the global nuclear nonproliferation regime, erect higher barriers to 
the acquisition of nuclear weapons and nuclear materials by terrorist 
groups, and strengthen U.S. and international security.

    29. Senator Cornyn. Secretary Creedon and Secretary Weber, do you 
believe U.S. allies still feel assured under our nuclear umbrella? If 
not, do you foresee them building up their own nuclear capabilities?
    Ms. Creedon and Mr. Weber. We have strong and positive indications 
that our allies and partners continue to feel assured. We meet 
regularly with the North Atlantic Treaty Organization (NATO), 
Australia, the United Kingdom, France, Japan, and the Republic of Korea 
to discuss our ongoing extended deterrence.

    30. Senator Cornyn. Secretary Creedon and Secretary Weber, would a 
shift in U.S. nuclear doctrine away from counterforce and flexibility 
toward minimum deterrence weaken the credibility of U.S. nuclear use on 
behalf of allies?
    Ms. Creedon and Mr. Weber. Yes. For decades, the United States has 
rejected a minimum deterrence doctrine as ill-suited to meet our 
deterrence objectives, including the extension of U.S. nuclear 
deterrence to our allies and partners.

    31. Senator Cornyn. Secretary Creedon and Secretary Weber, do you 
believe that at lower numbers, the implications of cheating become more 
important?
    Ms. Creedon and Mr. Weber. Yes. In general, as the number of 
strategic forces diminishes, the military significance of cheating 
could be more significant. The United States would view any deliberate 
effort by Russia to exceed the New START treaty's limits or circumvent 
its verification regime with great concern, especially if the cheating 
had military significance. For that reason, it is important that 
militarily significant cheating can be detected in time to respond 
appropriately. Should there be any signs of Russian cheating or 
preparations to break out from the New START treaty, this would be 
raised through diplomatic channels immediately, and if not resolved, 
raised to higher levels immediately. The administration would also keep 
the Senate informed.
    As stated in the NPR of 2010, because of our improved relations, 
the need for strict numerical parity between the United States and 
Russia is no longer as compelling as it was during the Cold War. 
However, large disparities in nuclear capabilities could raise concerns 
on both sides and among U.S. allies and partners, and may not be 
conducive to maintaining a stable, long-term, strategic relationship, 
especially as nuclear forces are significantly reduced.

    32. Senator Cornyn. Secretary Creedon and Secretary Weber, would 
lower strategic nuclear force levels exacerbate the existing disparity 
in tactical nuclear weapons between Russia and the United States? If 
so, wouldn't this affect allied calculations during future crises?
    Ms. Creedon and Mr. Weber. Because of our improved relations, the 
need for strict numerical parity between the two countries is no longer 
as compelling as it was during the Cold War. But large disparities in 
nuclear capabilities could raise concerns on both sides and among U.S. 
allies and partners, and may not be conducive to maintaining a stable, 
long-term strategic relationship, especially as nuclear forces are 
significantly reduced. Therefore, it is important for Russia to join in 
any move to lower levels. In any post-New START treaty negotiations 
with Russia, we plan to address non-strategic nuclear weapons, as well 
as the non-deployed nuclear weapons of both sides.

                         china's nuclear forces
    33. Senator Cornyn. Secretary Creedon and Secretary Weber, 
according to DOD data, since 2001, China has perhaps tripled the size 
of its ICBM force. Add to this, China's ambitions for a submarine-based 
nuclear force, as well as increasing numbers of short- and medium-range 
ballistic missiles. Dr. James Miller, who is currently the Acting Under 
Secretary of Defense for Policy, testified to Congress in March 2011, 
that ``the lack of transparency surrounding China's nuclear programs--
their pace and scope, as well as the strategy and doctrine that guide 
them--raises questions about China's future strategic intentions.'' His 
concerns seemed to be confirmed in December 2011, when research by 
Georgetown University revealed that China could have as many as 3,000 
nuclear missiles and thousands of miles of underground tunnels to hide 
this arsenal. How large is this force likely to be in another 10 years?
    Ms. Creedon and Mr. Weber. [Deleted.]

    34. Senator Cornyn. Secretary Creedon and Secretary Weber, what is 
your assessment of the incentive that further reductions in U.S. 
nuclear weapons would provide to China and other nuclear powers to 
build up to United States and Russian levels?
    Ms. Creedon and Mr. Weber. The United States and Russia still have 
approximately 90 percent of the nuclear weapons that exist today. China 
and others are far from being in parity with the United States and 
Russia. We seek a relationship of strategic stability with China, as we 
do with Russia, focused on improving transparency and mutual 
confidence.

    35. Senator Cornyn. Secretary Creedon and Secretary Weber, how many 
nuclear weapons does the United States need to maintain to convince 
China not to seek strategic equivalence?
    Ms. Creedon and Mr. Weber. We need to continue to foster strategic 
stability in the Asia-Pacific region so that China does not conclude 
that it needs to seek parity in nuclear arsenals.

                            missile defense
    36. Senator Cornyn. Secretary Creedon and Secretary Weber, I am 
also particularly concerned regarding President Obama's recent 
unfortunate admission to Russian President Dmitry Medvedev that he is 
waiting until after the election, when he can exercise more flexibility 
to deal with issues relating to missile defense. Although not having to 
worry about the judgment of the American people on this issue may be 
convenient, allowing the President to make more concessions to the 
Russians would be antithetical to our safety and security, as well as 
dishonest and contrary to the assurances President Obama has given. In 
order to secure Senate support for the New START treaty, President 
Obama pledged to continue development and deployment of all stages of 
the Phased Adaptive Approach (PAA) to missile defense in Europe. What 
is the precise status of the plan to deploy the remaining three phases 
of PAA?
    Ms. Creedon and Mr. Weber. The United States has pursued missile 
defense cooperation with Russia with the clear understanding that we 
would not accept constraints on missile defense and we would implement 
all four phases of the European Phased Adaptive Approach (EPAA). The 
plan has not changed.

    37. Senator Cornyn. Secretary Creedon and Secretary Weber, 
President Obama's discussions with Russian President Dmitry Medvedev at 
the Nuclear Security Summit in Seoul do not appear to have produced any 
fruit, with Medvedev stressing that the United States and Russia remain 
in their respective, opposing positions on missile defense. Ellen 
Tauscher, former Under Secretary of State for Arms Control and 
International Security Affairs, stated at the 10th Annual Missile 
Defense Conference this week that the administration is committed to 
``getting Russia inside the missile defense tent now,'' so that the 
United States can demonstrate to Russia that missile defense systems, 
``will not threaten Russia's strategic forces.'' She believes this 
conversation, and associated exchanges of information that have been 
discussed, are ``essential because Russia has not been convinced by our 
technical arguments that the NATO system isn't a threat even despite . 
. . detailed technical responses to Russia's inaccurate assumptions 
about our missile defense capabilities.'' It seems that Secretary 
Tauscher is operating based on a flawed assumption that Russia will 
eventually agree to our missile defense plan, despite already receiving 
repeated assurances and technical responses from the United States. 
What is your assessment of the likelihood that further dialogue will 
placate Russia's fears regarding the deployment of missile defense 
systems in Europe?
    Ms. Creedon and Mr. Weber. We continue to believe that cooperation 
with Russia on missile defense, both bilaterally and through NATO, can 
enhance the security of the United States, our allies and partners in 
Europe, and Russia. We will continue to work with Russia to define the 
parameters of possible cooperation.
    Russia has an extensive and capable sensor network for tracking 
ballistic missiles that could make a real contribution to the 
protection of U.S. deployed forces, and allies and partners in Europe. 
In addition, U.S.-Russia and NATO-Russia cooperation would send a 
strong signal to Iran that its development of missiles and pursuit of 
nuclear capabilities are reducing rather than enhancing Iranian 
security. Cooperation would also signal that the United States and 
Russia agree on the dangers posed by the proliferation of ballistic 
missile and nuclear technology.
    At their meeting, President Obama and President Medvedev reaffirmed 
their intent to continue a dialogue on missile defense cooperation.

    38. Senator Cornyn. Secretary Creedon and Secretary Weber, do you 
believe that offering them concessions, such as viewing Aegis SM-3 
missile defense flight tests, will improve the likelihood that Russia 
will be willing to cooperate in the future?
    Ms. Creedon and Mr. Weber. Offering Russia the opportunity to 
observe a missile defense flight test is not a concession. Flight test 
observations have been used by this administration and the previous 
administration to provide Russia the opportunity to understand more 
fully the purpose and intent underpinning our missile defense plans and 
programs.
    Transparency regarding our missile defense plans and programs 
increases the credibility of our arguments that our missile defenses 
are not directed at Russia and will not negate Russia's strategic 
deterrent. Credibility on this issue is important for our current 
missile defense cooperation with allies and partners, as well as for 
potential future cooperation with Russia.

    39. Senator Cornyn. Secretary Creedon and Secretary Weber, what 
would the ramifications be if the United States were to continue 
fielding the PAA without Russia's blessing?
    Ms. Creedon and Mr. Weber. The United States is not seeking 
Russia's blessing on the implementation of the EPAA. The United States 
remains committed to fully deploying all four phases of the EPAA to 
counter a real and growing threat from the Middle East. We remain 
hopeful that Russia will work with us to counter the threat from 
ballistic missile proliferation.

              funding for the strategic nuclear deterrent
    40. Senator Cornyn. Secretary Creedon and Secretary Weber, last 
year, Dr. James Miller testified to Congress that the 10-year cost of 
sustaining and modernizing U.S. strategic nuclear forces will be 
approximately $125 billion over 10 years, which does not include the 
NNSA funding for the nuclear weapons complex and the warheads. Assuming 
that amount remains roughly constant, that is about $12.5 billion per 
year for the nuclear deterrent, which equates to approximately 3 
percent of the defense budget. During the Cold War, we devoted up to 25 
percent of the defense budget to nuclear deterrence. We should bear 
this in mind. It's important for Congress to understand just how much 
our nuclear deterrent costs. What is the total that DOD plans to spend 
over the next 10 years to sustain and modernize U.S. strategic forces? 
Please provide a breakdown of that funding by weapon system or whatever 
category makes the most sense.
    Ms. Creedon and Mr. Weber. The information will be provided to you 
in the report pursuant to section 1043 of the National Defense 
Authorization Act for Fiscal Year 2012. This report will be submitted 
to you within a few weeks. This document will update our 10-year cost 
profile as provided in the previous reports provided pursuant to 
section 1251 of the National Defense Authorization Act for Fiscal Year 
2010, and will provide additional information on the 10-year cost of 
sustaining and modernizing our nuclear command and control assets.

                  nuclear modernization and reduction
    41. Senator Cornyn. Secretary Creedon and Secretary Weber, the 2010 
NPR stated: ``Implementation of the Stockpile Stewardship Program and 
the nuclear infrastructure investments recommended in the NPR will 
allow the United States to shift away from retaining large numbers of 
nondeployed warheads as a hedge against technical or geopolitical 
surprise, allowing major reductions in the nuclear stockpile. These 
investments are essential to facilitating reductions while sustaining 
deterrence under New START and beyond.'' In other words, the 
modernization program was intended to give us, among other things, a 
modern manufacturing capability necessary to extend the life of our 
nuclear weapons and to be able to respond to unforeseen events that may 
require the manufacturing of nuclear weapons components, such as the 
nuclear pits. The logic was that once we had this capability, we would 
eliminate some of the nuclear warheads that are in the non-deployed or 
hedge category. For example, the United States has approximately 5,000 
nuclear warheads of all types; of this, approximately 2,000 are in the 
operational category, the rest are non-deployed. If the Chemistry and 
Metallurgy Research Replacement-Nuclear Facility (CMRR-NF) is delayed 
from 2021 to 2028 at the earliest, does it not follow that we should 
similarly delay the elimination of our nondeployed or hedge weapons?
    Ms. Creedon and Mr. Weber. The NNSA is reviewing the impacts that 
resulted from the deferral of the CMRR-NF. This will help inform the 
NWC on the path forward regarding plutonium pits for our life-extension 
programs and related decisions on hedge weapons. The uranium processing 
facility (UPF) is also an important contributor to the manufacturing 
capability of the nuclear infrastructure. DOD fully supports staggering 
the two projects with UPF going first.

    [Whereupon, at 3:31 p.m., the subcommittee adjourned.]


DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 
               2013 AND THE FUTURE YEARS DEFENSE PROGRAM

                              ----------                              


                       WEDNESDAY, APRIL 25, 2012

                               U.S. Senate,
                  Subcommittee on Strategic Forces,
                               Committee on Armed Services,
                                                    Washington, DC.

            BALLISTIC MISSILE DEFENSE POLICIES AND PROGRAMS

    The subcommittee met, pursuant to notice, at 12:56 p.m. in 
room SR-222, Russell Senate Office Building, Senator E. 
Benjamin Nelson (chairman of the subcommittee) presiding.
    Committee members present: Senators Nelson and Sessions.
    Majority staff members present: Jonathan S. Epstein, 
counsel; and Richard W. Fieldhouse, professional staff member.
    Minority staff member present: Daniel A. Lerner, 
professional staff member.
    Staff assistant present: Brian F. Sebold.
    Committee members' assistants present: Ryan Ehly, assistant 
to Senator Nelson; and Lenwood Landrum, assistant to Senator 
Sessions.

   OPENING STATEMENT OF SENATOR E. BENJAMIN NELSON, CHAIRMAN

    Senator Nelson. Senator Sessions will be just a little bit 
late and he's asked that I go ahead and start, so it won't 
matter if we start a little bit early. We might have a couple 
more minutes to have the hearing.
    The subcommittee is now in session and is meeting today 
under somewhat unusual circumstances. Since the Senate will 
have a series of votes throughout this afternoon, we had to 
move up the hearing to start early. Otherwise we wouldn't have 
been able to hold the hearing before our committee marks up the 
National Defense Authorization Act for Fiscal Year 2013.
    Since the votes will start at 2 o'clock, we'll have a 
highly compressed hearing. Probably that doesn't break your 
hearts, to have to have a little bit less time in the hearing. 
But we won't be making the ordinary, normal opening statements. 
Instead we'll put all the opening statements in the record, 
together with your other prepared testimony, in order to 
maximize our time.
    We'll also give members an opportunity, when Senator 
Sessions gets here, to submit statements and questions for the 
record. The record will remain open until the end of next 
Tuesday, to make certain we get the complete record in the 
transcript. We would greatly appreciate if you could respond 
promptly to the questions so that we can then answer some of 
the questions that are so important that are facing us.
    I want to thank all of you today, each of you, for your 
service, for your flexibility and understanding of our need to 
start the hearing early. Our witnesses today are: the Honorable 
J. Michael Gilmore, Director of Operational Test and 
Evaluation, Department of Defense (DOD); Dr. Bradley H. 
Roberts, the Deputy Assistant Secretary of Defense for Nuclear 
and Missile Defense Policy; Lieutenant General Patrick J. 
O'Reilly, USA, the Director of the Missile Defense Agency 
(MDA); Lieutenant General Richard P. Formica, USA, the 
Commander of the U.S. Army Space and Missile Defense Command/
Army Forces Strategic Command and Commander, Joint Functional 
Component Command for Integrated Missile Defense; and Ms. 
Cristina T. Chaplain, the Director of Acquisition and Sourcing 
Management at the Government Accountability Office (GAO).
    I thank Senator Sessions and his staff for being able to 
accommodate the rescheduling of the hearing today.
    We'll begin the question and answer period with 7-minute 
rounds. I'll use all the time that I can until Senator Sessions 
gets here and then we'll recognize him right away.
    In terms of Homeland defense as a priority--and this is a 
question for Dr. Roberts and our two generals--General 
O'Reilly's prepared statement says that, ``Defense of the 
Homeland is our highest priority,'' which is consistent with 
the Ballistic Missile Defense Review (BMDR). But some have 
questioned whether it is the top missile defense priority or 
suggested that we have to choose between Homeland defense and 
regional missile defense.
    Can each of you tell us if Homeland defense is the 
administration's top missile defense priority and if you 
believe we can and should and do provide both Homeland defense 
and regional missile defense capability simultaneously in a 
balanced manner that meets our warfighters' needs?
    Dr. Roberts?
    Dr. Roberts. Thank you, Mr. Chairman.
    The BMDR actually sets out six priorities and we would 
continue to hold to all of them. Top of the list, the first 
priority, is the protection of the Homeland. But it's a false 
choice between the first priority and the other priorities. We 
have it within our means and within the current budget to do 
everything we need to do to advance our commitment to both 
Homeland defense and regional defense.
    The perception of an imbalance of investment here has been 
reinforced by some inaccurate information that was put into 
play earlier. My reading of the budget in front of you is that 
roughly one-third or 37 percent can be uniquely associated with 
regional missile defense and the remaining two-thirds is either 
uniquely associated with Homeland defense or reinforces both 
sets of commitments, for example investments in command and 
control, investments in the Precision Tracking Space System 
(PTSS) sensor system.
    So we don't see that our investments are skewed heavily 
away from Homeland defense. We see a robust set of investments 
in addressing the reliability problems in the ground-based 
interceptor (GBI), strengthening the sensor system, taking 
additional steps to strengthen the defense of the Homeland. The 
budget permits us to do all of those things in a balanced 
manner with acceptable risk.
    Thank you, sir.
    Senator Nelson. Isn't it also true that this concept of 
dual protection isn't new with this administration? The 
previous administration introduced the idea of some regional 
defense mechanisms during the last administration; isn't that 
accurate?
    Dr. Roberts. Yes, indeed, that's accurate. Our national 
commitment to both of these areas has been clear since the end 
of the Cold War. The Persian Gulf war woke us up to the fact of 
regional missile proliferation and long-range missile 
proliferation. So in the 1990s, first the Bush administration 
and then the Clinton administration talked about theater 
missile defense and national missile defense. The Bush 
administration for the last decade set out a different set of 
shorthands, but the same basic concept, that we pursue a 
balanced approach. We similarly have set out a balanced 
approach.
    So yes, sir, we see continuity over the last 3 decades to 
our national commitment in this area.
    Senator Nelson. Part of that would be consistent with the 
Phased Adaptive Approach (PAA) that is under consideration 
right now; is that accurate?
    Dr. Roberts. Yes, sir. The notion of bringing together 
regional defensive capabilities in tailored support of our 
commitments in individual regions goes back to the initial 
development of these capabilities in the 1990s. It would be--
although our principal political debate has been focused on 
European Phased Adaptive Approach (EPAA) missile defense, I 
would say there's a longer history of phasing and adapting 
missile defense in Northeast Asia, in partnership with Japan, 
and similarly in the Middle East in partnership with Israel and 
some others.
    So we have a long history of adapting and integrating these 
capabilities as they emerged proven from the technology 
developers, and indeed that dates back a good number of years.
    Senator Nelson. General O'Reilly?
    General O'Reilly. Senator, I would also add that this 
budget that we've submitted is balanced, and the balancing 
occurred with the full participation of not only the Office of 
the Secretary of Defense for Policy, but also Dr. Gilmore in 
considering the test needs, also warfighter priorities, the 
combatant commands, the Joint Chiefs, and the Services.
    In that balancing and looking at both regional and Homeland 
defense, we considered the intelligence. In the area of 
regional defense, there's a significant disparity between the 
number of missile defense systems we have and interceptors and 
the number of threat missiles that we see in the regional 
context, globally. We're not in that position with Homeland 
defense. We want to stay in a position of strength, where today 
we have a greater Homeland defense than the threat of future 
ICBMs from current regional threats.
    Finally, technical progress. In the Ground-based Midcourse 
Defense (GMD) program right now, we are addressing and are 
prepared to come back to flight testing, but we are paced by 
the flight test progress that we've had, and we've had two 
failures. No matter what budget we are discussing, we have to 
get over those flight test failures. I don't think those 
failures would have been avoided if we would have had a larger 
or a lesser budget than we had. It's a matter of working 
through the flight environments and the other issues which we 
uncovered in testing.
    Senator Nelson. In terms of let's say even the regional 
defense mechanisms, aren't we finding that some of the nations 
in connection with the regional defense are providing us help 
with their own radar and their own capacity for technology?
    General O'Reilly. Yes, sir. We've had very extensive 
discussions in many theaters around the world, in the North 
Arabian Gulf and Europe and Northeast Asia. We participate with 
over 20 countries that work either on missile defense, working 
in analyzing architectures, or where they can contribute, as 
you said. They have lower tier systems, some of them have Aegis 
systems, Patriot, their own indigenous systems like the French 
surface-to-air missile (SAMP-T), and the Dutch and others have 
made declarations this year that they are investing in their 
own budgets to modify their ship radars so they can participate 
and we can utilize the data coming off those radars.
    So we've had an extensive amount of cooperation in order to 
leverage their capability, which is primarily a lower tier, and 
we bring the higher intercept altitudes, the upper tier, to a 
missile defense architecture.
    Senator Nelson. General Formica?
    General Formica. Mr. Chairman, thank you for the 
opportunity to add to this discussion. From an operator's 
perspective, this really does come down to a balance of many 
competing priorities--Homeland, region, operational risk, and 
affordability. We recognize the six priorities laid out in the 
BMDR and recognize that Homeland defense clearly identifies the 
number one priority and protecting our forces, allies, and 
friends abroad as our number two priority.
    My assessment is that it was appropriately discussed and 
adequately represented in the discussions that led to the 
approval of the MDA's budget that you have in front of you. It 
also recognizes that there is never going to be enough missile 
defense assets to satisfy all of the warfighters' demands. But 
this budget, I believe, is an appropriate balance of Homeland 
defense, regional capability, operational risk, and 
affordability.
    Senator Nelson. Thank you.
    General O'Reilly, our missile defenses must provide force 
protection for our forward-deployed military personnel and 
that's an overarching national priority referred to by General 
Formica, and it's a responsibility to our troops as well. If we 
were just trying to provide protection for our military forces 
deployed in Europe, wouldn't that require some missile defense 
capabilities very similar to our planned EPAA, with the number 
of troops that we have stationed and the number of bases that 
are located within that area?
    General O'Reilly. Yes, sir, it would. As I said before, we 
provide primarily the high altitude intercepts. Because of the 
nature of that intercept, occurring exoatmospherically or up in 
the higher parts of our atmosphere, you get a very broad area 
coverage for that layer of defense. If we only isolated on U.S. 
bases or U.S. interests in the region, we still would cover a 
very large portion of Europe, because the coverage extends 
beyond just the particular asset you're trying to protect. 
Under article 5 of our North Atlantic Treaty Organization 
(NATO) agreement, we are committed to, if we have the 
opportunity, we will defend another threatened portion of NATO.
    Senator Nelson. Our troops' force protection has to be 
among the highest priorities, together with protecting the 
Homeland, as General Formica said. So in a sense we get two 
areas of protection, one of our allies and the other is for our 
own troops, with this regional or theater protection system; is 
that accurate?
    General O'Reilly. Yes, Senator.
    Senator Nelson. Thank you.
    General O'Reilly, in previous testimony you've indicated 
that the missile defense program and budget request were 
reviewed, and General Formica has made reference to it as well, 
by an array of senior decisionmakers at the Missile Defense 
Executive Board (MDEB), with the participation of the Joint 
Chiefs of Staff, the Services, combatant commands, the Deputy 
Secretary of Defense, and finally the Secretary of Defense.
    Can you tell us, did they review and approve the current 
budget request for missile defense?
    General O'Reilly. Yes, Senator, they did. The process 
involves typically at least a half a year of me returning to 
that board, presenting different options, getting guidance from 
them. It is a very rigorous process, very iterative process, as 
they balance the intelligence and the other needs to formulate 
a final budget.
    I would also add, Senator, that Dr. Gilmore is part of that 
board, too, and our testing represents a large part of the 
budget every year in order to give the combatant commanders 
confidence that we have the capability and also to support and 
address any issues which my programs may reveal based on 
previous testing.
    Senator Nelson. Dr. Gilmore, could you give us your 
perspective on this process of review and the conclusions that 
were drawn?
    Dr. Gilmore. It's a rigorous review, and to support the 
reviews that are actually done by the MDEB, General O'Reilly 
and I and our staffs participate in a number of reviews, as the 
two versions that are done each year of the integrated master 
test plan, that lays out all the testing for all the elements 
of the Ballistic Missile Defense System (BMDS), is developed, 
and we have a good technical interchange and sometimes robust 
debate about what the content of the test program ought to be, 
and we always reach good conclusions about what it ought to be.
    The plan in my opinion that was recently submitted this 
year is a very rigorous plan. In fact, in the 20 years I've 
been dealing with missile defense, the most rigorous plans for 
testing ballistic missile defenses (BMD) that I've seen are the 
ones that General O'Reilly has produced when he started with 
the Integrated Master Test Plan (IMTP) process.
    I'd note that the testing for ground-based missile defense, 
the defense of the Homeland, in the most recent IMTP, the pace 
of that and the content of it has been preserved despite the 
budget cuts that DOD has taken to comply with the Budget 
Control Act (BCA), and the pace and content of GMD testing is 
essentially the same as it's been for the last 2 or 3 years 
since I've been involved in this process.
    The focus of the testing is on doing flight testing to 
discover the problems that have been discovered, which are very 
important--actually, sometimes you learn a lot more from the 
failures than you do from the successes--but also on validating 
and accrediting the models that are going to be key. In fact, 
it is the only way to build high confidence in the performance 
of the system, because none of these elements, including GMD, 
are actually going to be able to be tested in all aspects 
across the full battle space and in totally operationally 
realistic conditions, because of real world constraints, like 
we can't fire out of the Russian information flight region when 
we do tests.
    So I'm very happy with the process that's in place and the 
plan I think is very rigorous and defensible.
    Senator Nelson. Thank you.
    General Formica, you made some reference to the amount of 
time and the number of individuals doing the review. Are you 
satisfied that the review was appropriately undertaken and that 
the conclusions drawn are the best conclusions that could be 
drawn?
    General Formica. Mr. Chairman, again thank you for the 
chance to comment. I'm new to this business; 24 months ago I 
didn't know what an MDEB was. So I haven't had an opportunity 
to participate in the system. I walked away with confidence in 
the system as it is laid out and in the way and manner in which 
it was applied in the development of this budget.
    It started with the requirements of the demands that the 
combatant commanders have brought forward, synthesized by the 
U.S. Strategic Command (STRATCOM) in a Prioritized Capability 
List (PCL). Every time that MDA brought forth a budget 
proposal, what we call the Program Objective Memorandum (POM), 
and a series of alternate POMs--and there were several 
iterations--and we also considered alternatives that weren't 
necessarily done by the MDA, to look at a full range of 
budgeting options--program options.
    We compared those against the PCL. The operators, both 
Deputy Commander of STRATCOM and I, were at the MDEB to provide 
that operational assessment. U.S. Northern Command was 
generally represented there, as well as the Services. There 
was, as you heard in this testimony, healthy discussion and 
debate and it is my assessment that this budget that you have 
in front of you is a reflection of an appropriate balance of 
affordability versus risk, and again Homeland versus region, 
and we discussed all of those tradeoffs in this process.
    Senator Nelson. Thank you.
    Ms. Chaplain, the report you issued last Friday focuses on 
what you assess to be high levels of concurrency in a number of 
MDA programs. Although DOD has agreed with almost all of your 
recommendations, I take it that General O'Reilly has a maybe 
perhaps different view on concurrency. I'd like to explore the 
issue.
    Ms. Chaplain, you acknowledge that some concurrency is 
acceptable and probably inevitable under the circumstances. 
What do you believe constitutes an acceptable level of 
concurrency and perhaps you could give us an example that would 
be helpful?
    Ms. Chaplain. Yes. You can look at concurrency in terms of 
a spectrum and not as an on and off switch in terms of when it 
gets bad or isn't bad. A lot of programs need to buy some long 
lead items, for example, that represent some concurrency in a 
program and that's okay to do. Where we get concerned is where 
we see what we believe to be pretty extreme levels of 
concurrency. For example, if you're testing and producing 
assets at the same time, and therefore when you find problems 
you're going to have to do a lot of expensive retrofits. We've 
seen that in a couple of the programs. That's where we've 
highlighted concerns.
    I don't believe we had really acknowledged enough that some 
concurrency was okay in our draft and General O'Reilly was 
responding to some of that.
    Another example, though, where we see concurrency as being 
a little bit more on the extreme side is with the lining up of 
knowledge for making a long-term program commitment. We'd like 
to see a preliminary design review inform that decision to make 
a long-term commitment to a program, because that review helps 
ensure that you can match resources to requirements, your 
technologies are well understood, and that you can get 
something done within the resources you have.
    In a couple of cases we've seen that particular review come 
after that commitment. So we've already made a long-term 
commitment to something and yet you don't have that knowledge 
that you need, that we believe you need, to make that 
commitment.
    Senator Nelson. General O'Reilly, what do you believe would 
be an acceptable level of concurrency, and have you been taking 
steps to reduce the level of concurrency in the programs?
    General O'Reilly. Yes, sir. We agree in large part with 
what the GAO report contained from the point of view of it's 
very high risk, as far as cost goes, to deploying a missile 
system, for example, that hasn't gone through what we call 
ground qualification testing, testing all the environments and 
the components.
    I do believe there has to be some concurrency, first of all 
from an industrial base point of view. What we typically do is 
develop prototypes or early production models, and those are 
the items which we fly. However, if we do not sustain the 
production base during that period--and a lot of times our test 
programs take 2 years or more--we actually raise risk to the 
program by not continuing to produce at a low level.
    I think the best balance is to ensure you have very good 
ground qualification to convince yourself that we have no 
inherent problems in the designs, and then move to flight 
testing, but continue at a low production rate, which most 
programs do. Unfortunately, with missile defense programs, 
there are very few end items in the end because we're limited 
in the number of missiles we procure, and the budget. So we 
have to be very careful of sustaining some production while 
we're going through testing.
    We have, in fact, reduced a significant amount of 
concurrency. I did not concur with the level of concurrency in 
the current programs when I became the director. We reviewed 
them and we added approximately a year to the test program and 
the design phase of the program for the 1B, and we also added 
approximately 2 years to the 2A program to address concurrency. 
That was prior to the GAO report, and we do balance that. It 
also depends on the maturity of the technology.
    Senator Nelson. Ms. Chaplain, do you agree with General 
O'Reilly's assessment there?
    Ms. Chaplain. I would make a couple points. I think in 
terms of what's the optimum amount of production numbers when 
you're in that phase trying to sustain an industrial base, 
where we've had disagreements is actually the amount that is 
being produced and is it too much, is it going beyond what you 
need for test assets. In that case, I think MDA recently took 
action to address that concern we had in the 1B program.
    In terms of trying not to put in gaps in the industrial 
base, our concern is when there is too much concurrency and you 
have the need to retrofit and stop production, you're actually 
creating more disruptions to the industrial base. So there is a 
careful balance there.
    Lastly, I would just also recognize that, I think, after 
our audit work MDA took a step on the GMD side to put off 
production until it has that flight intercept test, which we 
had a very specific recommendation about. So we were happy with 
some of the steps that were made that we weren't able to really 
recognize in our report because they were made after our audit 
work.
    Senator Nelson. I assume that you agree that the practical 
realities of production are such that you can't always have a 
line of production sitting idle, so that there are some 
requirements that things continue to move. But your concern 
would be that they not move too quickly, so that you get ahead 
of your testing. Is that a fair statement?
    Ms. Chaplain. Yes. It's not ramping up too much before that 
testing is complete so that it becomes very expensive to make 
those adjustments.
    Senator Nelson. By the same token, having a line idle is 
not very likely and that's costly as well.
    Ms. Chaplain. It's costly and you could lose key skills, 
which are difficult to find in this kind of system development. 
So it's a balancing act. We recognize that. We're not trying to 
be very black and white about this. But in the cases we've 
looked at it--the concurrency there was more than we were 
comfortable with. It's resulted in problems. Our 
recommendations are just aimed at having DOD go back and look 
across the portfolio, see where concurrency could be reduced. I 
don't think it's realistic to expect it to be reduced across 
the board.
    Senator Nelson. I think it's safe to say that General 
O'Reilly will do his best to keep concurrency at an acceptable 
level, recognizing the costly nature of getting ahead or 
falling behind. We appreciate those thoughts.
    My friend and colleague has arrived, the ranking member. 
I've taken all of your time.
    Senator Sessions. I don't have anything left. [Laughter.]
    Senator Nelson. No, I think you do. But we compressed the 
timeframe without opening statements, but you're entitled to an 
opening statement--I made one--if you choose. We're in a 7-
minute round for questions. I have answered--I have raised 
several questions and have several more. But at this point I'd 
say the floor is yours.
    Senator Sessions. Thank you. I had a very important 
engagement. I grew up in a little town, there were 30 in my 
senior class, and I just got to have lunch with my classmate of 
first through 12 grades, who's the President of the University 
of Alabama, who just got elevated. Of course, her brother's 
Congressman Joe Bonner from the House. We also have a 
lieutenant governor of Alabama who's a couple of years ahead of 
us. So we're a pretty good little group, I guess, all things 
considered. So it was a real pleasure to see her.
    Senator Nelson. I'll brag on mine next hearing.
    Senator Sessions. It was a pleasure to see my classmate 
just after she's been selected to that important office. In 
Alabama, that's a big deal. Next to the football coach or the 
President, it's pretty important.
    I request my prepared statement be inserted for the record 
to save time.
    [The prepared statement of Senator Sessions follows:]
              Prepared Statement by Senator Jeff Sessions
    Thank you very much, Mr. Chairman, I join you in welcoming our 
distinguished panel of witnesses.
    Today's hearing focuses on the President's fiscal year 2013 budget 
for the Missile Defense Agency (MDA). In today's fiscal environment, no 
budget is immune to cuts and the $7.75 billion request for MDA was 
certainly no exception. Unfortunately, MDA's reductions reflect a 
concerning imbalance and underfund the procurement, sustainment, and 
modernization of proven capabilities, to pay for the development 
efforts necessary to fulfill the President's unproven vision for the 
defense of Europe. We had a plan, which would have provided a lower 
risk option to augment the defense of the Homeland against a long-range 
Iranian threat. Now because of our dismal fiscal situation, we are 
faced with unfortunate tradeoffs, such as having to cut funding for the 
procurement of high demand mature systems--like transportable radars 
and the Terminal High Altitude Area Defense system--in order to sustain 
funding for the development of higher risk efforts, like the SM-3 IIB.
    Rogue nations continue to pursue the capabilities necessary to 
inflict unimaginable harm on the United States. Now is not the time to 
rest on our laurels and sacrifice the security of the Homeland for 
regional architectures. Regional and Homeland defense can and should 
coexist. System robustness and diversity should be encouraged. However, 
funding must be balanced and encourage the refinement of proven 
capabilities, not poorly defined ones that rely on high levels of 
concurrency and provide questionable benefit to Homeland defense.
    It has been almost a year and a half since the last Ground-based 
Midcourse Defense (GMD) test failure and unfortunately the problems 
remain unfixed. I look forward to understanding why MDA believes it can 
achieve and sustain success in returning GMD back to its full 
capability as quickly as possible, while also fulfilling the 
modernization efforts that have been postponed since 2010. After all of 
the money we have spent developing this capability, taking our eye off 
the ball is simply unacceptable. As North Korea reminded us a couple of 
weeks ago, diplomacy is not going to sway their intent to develop a 
missile capable of reaching the United States. We welcome their 
failures; however, North Korea is not going to quit their reckless 
ways. Returning GMD--the only system currently capable of protecting 
the United States from ballistic missiles--to its full capability must 
be our highest priority.
    I applaud MDA for the successful competition of the GMD development 
and sustainment contract. Through this competition, MDA was able to 
find efficiencies and savings that benefit the taxpayer, by achieving a 
20 percent cost savings, and ensure that the GMD program is well-
positioned to develop, improve, and expand this critical capability.
    Section 233 of the National Defense Authorization Act (NDAA) for 
Fiscal Year 2012 required the Department of Defense to submit a report 
on the Homeland missile defense hedging strategy. This strategy and 
policy framework, originally proposed in the Ballistic Missile Defense 
Review of 2010, is long overdue and was included in the NDAA for Fiscal 
Year 2012 to compel the administration to take a serious look at the 
technical risks associated with the later phases of the Phased Adaptive 
Approach. Thus far, I am disappointed that little has been relayed to 
Congress on how this administration intends to mitigate technological 
and threat-based risk. I look forward to hearing more from our 
witnesses on the hedging options being evaluated in the study, if those 
options include an assessment on the feasibility of deploying an east 
coast missile defense site, and when they expect this report will be 
delivered to Congress.
    The President has made it very clear that if reelected he intends 
to do whatever it takes to appease Russian concerns on missile defense, 
even if that means going beyond the restrictions Congress tried to set 
on sharing classified information. The President's ``more flexibility'' 
gaffe confirms what many of us have warned, that the President will do 
whatever it takes to reassure the Russians on missile defense even if 
that means giving them the keys to the front door and the pass code to 
the alarm. The extraordinary level of transparency shared today with 
Russia exceeds that of some of our closest allies. ``More flexibility'' 
with Russia on missile defense would make us less secure, and it must 
be made clear to President Obama that undermining our defensive 
capabilities is unacceptable.
    I thank the witnesses for joining us today and look forward to 
their testimony.

    Senator Sessions. General O'Reilly, General Formica, and 
Dr. Roberts: the fiscal year 2013 MDA budget creates an 
imbalance, an underfunding, it seems, underfunding the 
procurement, sustainment, and modernization of the proven 
capabilities, it seems to me, the things that we worked on and 
got ready to deploy, to pay for developing efforts necessary to 
fulfill the President's vision for a new kind of defense of 
Europe.
    We had a plan for a number of years that would have 
provided a lower-risk option to augment the defense of the 
Homeland against a long-range Iranian threat and also Europe. 
So now we're using monies from those programs to help pay for 
the more high risk programs--you and I have talked about it, so 
this is not a surprise--but to pay for the Standard Missile-3 
(SM-3) Block IIB, which is, I think, not developed, just 
beginning to go forward, and the risk factor in a lot of 
different areas is great.
    The budget proposes a reduction of more than $3 billion, it 
looks like to us, across the Future Years Defense Program for 
the procurement of Terminal High Altitude Aerial Defense 
(THAAD) and the AN/TPY-2 portable radars, two high demand 
systems that the Joint Staff-led joint capability mix study 
justified in past budgets.
    So is it true--I guess yes or no: Is it true that this 
budget reduces the number of planned THAAD battery purchases 
from nine to six? Who wants to be first on that? General?
    General O'Reilly. Sir, it has been reduced from nine to 
six. There was a process that we went through of many different 
budget alternatives and they were reviewed by DOD at the 
highest levels, including the Joint Chiefs, the combatant 
commanders, the Services. We went through many trades and part 
of the balance was the BCA requirements. But of the priorities 
that came out of it--and again, they were set by the priorities 
that General Formica's organization sets--this budget is 
consistent with those priorities.
    Senator Sessions. Of course we know that DOD has been asked 
to take a very substantial reduction and it had to make tough 
choices. So we're just trying to ascertain how that's playing 
out in real events.
    Isn't it true that the budget reduces the number of planned 
THAAD interceptors from 503 to 320?
    General O'Reilly. Yes, sir. It matches the number of units 
that we are now procuring.
    Senator Sessions. Doesn't it reduce the number of planned 
TPY-2 radars from 18 to 11?
    General O'Reilly. Yes, sir. Those radars are associated 
with the units.
    Senator Sessions. Is it true that the Joint Staff-led 
capability, joint capability mix study endorsed and was used as 
a justification for increasing quantities of these high-demand 
assets in last year's budget?
    General O'Reilly. Yes, sir, that was. As that was reviewed 
again this year, again by General Formica's organizations and 
others, and that was taken into account.
    Senator Sessions. Has the demand from the combatant 
commands for THAAD and TPY-2 radar decreased over the last 
year?
    General Formica. Sir, if I may, I would like to respond to 
that.
    Senator Sessions. Yes.
    General Formica. The demand for THAAD and TPY-2 radars, 
like the demand for other missile defense assets, continues to 
increase and has not been reduced by combatant commanders. The 
discussion on how many THAADs to procure as it came up in the 
review process during the MDEB really came down to going back 
to the priority between investing in the Homeland and investing 
in the region. THAAD is a capability that predominantly 
provides for investment--for defense, regional missile defense. 
So the decision was made to reduce the number of THAAD 
batteries from nine to six. Six was the minimum acceptable that 
the operators had identified, so we didn't go anywhere below 
that. There's demand for more than six. There's actually demand 
for more than nine. But again, balancing operational risk, 
affordability, Homeland defense, and regional defense, the 
decision was----
    Senator Sessions. Balancing the amount of money that you 
had.
    General Formica. Yes, sir, there is no doubt that was part 
of it. That was the affordability.
    Then I would just say, one of the important decisions that 
we take for granted is that the three THAADs that were reduced 
were the last three in the program. So this budget will build 
THAAD capability in the early years on the time and schedule 
that was originally programmed. It allows us to build that 
capability and establish increased capacity, and we will be 
able to assess based on operational requirements and budget in 
the following years.
    Senator Sessions. So you plan to stick at the 320, is that 
what that means?
    General Formica. It means that the current budget will 
start at the 320 interceptors. Again, as General O'Reilly said, 
that is appropriate for the number of launchers that are being 
procured. The number of launchers, it's tied to the number of 
batteries.
    Senator Sessions. Right. So the number of batteries and the 
number of launchers, the 320 would be where you plan to stop.
    General Formica. That's in the current program.
    Dr. Roberts. May I add a point to that discussion?
    Senator Sessions. Yes.
    Dr. Roberts. It's not where we plan to stop. We plan to 
continue to build capability for the Homeland and for the 
regions for decades to come. That's the plan in the FYDP. It's 
not as if at the end of that we've drawn a line and said that's 
enough. This is just what we're currently capable of funding. 
It leaves the production line open and it continues the 
capability in the regions, and it also gives our allies the 
opportunity to buy some of their own.
    Senator Sessions. I understand that allies might help keep 
an assembly line going. But if we allow the assembly line to go 
down, you just can't start it up so easily, and the price per 
copy would go up, would it not?
    General O'Reilly, it's been almost a year and a half since 
the GMD test failure. Unfortunately, the problems I understand 
have not been fixed. I understand that the flight test to 
validate the fix will not take place until December of this 
year, a full 2 years after the failure.
    Is there anything that you could have done, that you think 
now you could have done, to fix that capability enhancement 
sooner than we planned?
    General O'Reilly. Sir, the first issue we had was a quality 
control issue. We showed in the second flight that we have 
addressed that issue, and we did not have that in the second 
flight.
    Unfortunately, that delayed us from getting into a test 
regime and environments where we did find where we needed to 
revise the design of some of the components of the missile. 
Once we finish that, sir, going through the time it took to 
validate exactly what the issue was and convince ourselves we 
understood it, and then we started the process of building the 
revised components. But out of that understanding we now have 
changed--we have more stringent manufacturing requirements and 
we've found we were not meeting those manufacturing more 
stringent requirements, and that caused us to start again to 
adjust the production.
    What's really key in the time it's taking is, 
unfortunately, the components that we've had to redesign and 
revalidate and requalify are at the very beginning of the 
assembly process. So we have to literally disassemble most of 
the kill vehicle (KV) in order to get to the component and then 
very precisely build them back up. If it was some of the 
components on the outside, like a thruster problem or 
something, we could have very quickly replaced out the 
components once we had a redesign.
    So it's the nature, it happens to be, of the actual 
components where we found the issue that is the driver in the 
long timeline.
    Senator Sessions. Sometimes those things happen. We can all 
pretend that these things shouldn't happen, but sometimes they 
just do and I understand that.
    I guess, Mr. Chairman, if we look at it, we had the GMD 
trying to use a two-stage in Europe, and we have a THAAD 
program and a Patriot program, but we're shifting a good deal 
of money and resources to what is projected to work, an SM-3 
Block IIB, that I think now will be about 2020 before it's 
projected to be ready to deploy. Would that be about right, 
General O'Reilly?
    General O'Reilly. Sir, that's what we projected last year. 
But our budget we received--we requested $123.5 million. We 
received $13 million. So that has effectively delayed the 
program a year because we didn't have the funding to execute. 
So 2021 I believe is a more accurate number.
    Senator Sessions. We have severe financial challenges in 
this country, and I'm not sure how tough it's going to be. I'm 
not prepared to say that we're not going to have additional 
cuts, that it's not going to be put off longer, or you might 
have a technical difficulty and it's 2025, when we could have 
had in the ground, as I understand it, the two-stage by what, 
2017, something like that? What was the plan for the two-stage 
GMD for the Polish site? How long would it have been to be 
deployed?
    General O'Reilly. Sir, first of all, we flew the two-stage 
2 years ago and it has the same KV on it that we have in our 
three-stage. So we believe it is a very mature missile design 
and capability.
    As I recall, it was a 2014 delivery when we finished, when 
we'd begin delivering those. I defer to Dr. Roberts. I'm trying 
to remember.
    Dr. Roberts. Sir, when I assumed my responsibilities my 
first briefing on the European third site was that initial 
operational capability (IOC) had slipped to 2018. At the same 
time, we'd also lost the support of the Czech Government for 
the radar. But that was IOC, and as a result of the approach 
that we've taken with our allies we now actually have what 
might equate to IOC. We actually have phase one of the PAA 
already in place, the capabilities in place, radars deployed.
    We will continue to grow this capability to protect our 
forces and to give our allies opportunities to protect 
themselves. In other words, we will have covered a lot of 
ground in providing protection against the emerging Iranian 
threat, that would not have been covered at all until IOC, 
whenever it was. The briefing I got was 2018.
    So we can have a discussion about whether beyond 2018 we're 
on the right path, where you grow the capability. But the 
regional approach that's now in place puts capability into the 
field now that wasn't planned for another few years.
    Senator Sessions. I'm aware that this happened. I think 
some of it was to try to accommodate the Russians' concerns. 
But I believe had we been strong and firm the Czechs would have 
stayed in line, I think the Poles would have been happy to see 
the system deployed, and we would be on the road to doing it 
now. I'm a little bit concerned about where it all will end.
    We'll need to look at that. I just share that concern.
    Senator Nelson. Thank you, Senator Sessions.
    Dr. Gilmore, there have been numerous concerns raised over 
the years, especially after flight test failures, that our 
missile defense systems won't work in an effective manner. 
There have been some recent press articles on this. Part of 
your job is to evaluate whether our missile defense systems 
have demonstrated that they will work effectively in an 
operational environment. Do you believe that testing to date 
has demonstrated that our fielded systems are able to 
accomplish their initial missions and are improving in their 
capability against increasing missions?
    Dr. Gilmore. Testing to date has demonstrated the systems 
can work. What I will not make is a statement about confidence 
in the performance of the systems, because a statement of 
confidence for me is a statistical statement and it won't be 
ready for some time. As I have said in the two or three reports 
to Congress that I have submitted on testing of BMD, until we 
have, as I pointed out in my comments a minute ago, conducted 
enough flight tests, which will give us the information needed 
to verify, validate, and accredit the models that we will have 
to use in order to evaluate the performance of the systems 
across the full battle space in which they'll have to operate.
    In the report that I submitted this year, I provided 
quantitative estimates of performance and confidence in that 
performance for Aegis and Patriot. We're close and next year 
we'll provide the same kind of information on THAAD. But it 
takes time to gather the data, to verify, validate, and 
accredit the models. That is the focus of the test program and 
it will take a number of more years until we can do that 
comprehensively for all the elements of the system.
    We're continuing to gather data and improve the models, so 
we're making progress in that regard constantly. But a 
complete, comprehensive assessment is still a number of years 
away.
    Senator Nelson. General Formica, from the warfighter's 
perspective, do you have confidence in the capability of our 
fielded missile defense systems, and do you agree that they're 
becoming more capable?
    General Formica. Again, thank you, Mr. Chairman. The 
warfighter actively participates in and supports MDA's robust 
test program. The test program enables the system to 
demonstrate reliability in its performance. It improves 
warfighter confidence in the systems as they continue to test. 
It allows operators to develop tactics, techniques, and 
procedures so that when those systems are eventually fielded we 
are ahead of the game in having those procedures in place and 
begin to develop them, and it allows for us to begin training 
our operators. Finally, it provides an opportunity for 
interface between the operator and the material developer early 
on, so that they can consider adjustments based on operator 
input.
    So we support the test program, have confidence, continued 
growing confidence in the capability of the BMD system, and do 
agree that it is improving.
    Senator Nelson. General O'Reilly, from time to time as 
failures have occurred I'm sure that others have talked to you 
about those failures and asked questions as to what you're 
going to do to fix them. What do you say when people ask you 
whether or not these systems are going to work effectively if 
needed, after the failures?
    General O'Reilly. Sir, what we do is as we proceed forward 
with our flight test programs, we make each test tougher. We've 
had in the last 10 years, as I recall, 51 intercepts or 52 
intercepts out of 64 hit-to-kill intercepts. So we have a very 
high percentage of success. But each test we make it, again 
working with Dr. Gilmore and the test community, we make it 
harder.
    We also test in different environments. The basic 
environments, which for GMD for example, we've gone through the 
functionality. We've flown the older version. A large portion 
of the current version of our fleet of GBIs has flown five 
times and we have not found significant issues with it and we 
adjust to it.
    But when we have a failure, we have a very disciplined 
process. In fact, our failure review boards are formed before 
we have a test, just to make sure we don't lose anything and we 
can immediately capture data. Then it takes an extreme amount 
of analysis. These are complex programs, complex systems. We 
not only determine with renowned experts from around the 
country what the probable cause is. I require they demonstrate 
it to me, they prove it, that this is a failure.
    If they come up with three or four things that could have 
been the failure and they can't prove any one of them, then we 
do fixes to all of those probable causes. So that's a key 
point, sir. Our flight test at the end of this year is a non-
intercept test, purposefully, because we're going to fly that 
missile in a much rougher environment than you normally would 
in any of our missions to protect the United States, just to 
validate that we have solved this problem.
    Senator Nelson. There has been some confusion about the SM-
3, Block IIB system that's intended for phase 4 of the EPAA to 
missile defense. In addition to providing robust defense of our 
forces and allies in Europe against potential long-range 
missiles from Iran, it would also augment our Homeland defense 
capability by providing a forward-based and cost-effective 
early defense capability against potential future long-range 
Iranian missiles that could reach the United States.
    General O'Reilly, can you explain why you believe, if you 
do, the SM-3 IIB is important to our Homeland defense and what 
the impact would be if we didn't develop it.
    General O'Reilly. Sir, there's two levels of answers to 
this. First of all, the SM-3 IIB program is designed to be a 
program that intercepts a long-range ballistic missile, an 
ICBM, and that is what it's designed to do, a longer-range 
missile. That is its primary purpose. It's to intercept it if 
you're in the right location and you're on a mobile launcher, 
like a ship.
    If you intercept--and you can have a quite small missile 
compared to the capability if you're in the right location for 
the threat. If you're worried about, an example, Iran in the 
future and the United States, it's goal-tending. You get into 
the right position.
    The benefit of it is our regional systems are built by 
having shoot-look-shoot. You have several opportunities to make 
an attempt and then determine have you been successful, and 
then you shoot again. We have that for all our regional 
systems. We do not have that for our Homeland defense system, 
for all of the scenarios for Homeland defense. We want that so 
that GMD is the system we're dedicated to and it is our primary 
defense, but we would first like to have a shot at any early 
intercept to determine whether or not we need to shoot the 
second one.
    The second is, sir, is that in our industrial base we have 
a limited opportunity for companies to continue to compete and 
use their well-developed design teams in order to develop an 
intercept program to accomplish that capability.
    So I am concerned about the industrial base and I am 
concerned about the opportunity for multiple companies. I think 
it's important for competition that multiple companies have the 
opportunity to compete for our missile defense interceptor 
programs. Without the IIB program, that tremendously limits the 
ability for the industrial base to maintain their expertise and 
capability.
    Dr. Roberts. Sir, may I add an additional point to the 
discussion?
    Senator Nelson. Sure, please.
    Dr. Roberts. This goes to Senator Sessions' concern about 
the balance of investment between GBIs and SM-3 IIB. General 
O'Reilly has set out the important operational benefit of being 
able to have two tiers in this defense of the Homeland. So when 
we've talked about EPAA phase 4, people associate the SM-3 IIB 
with the defense of Europe. Yes, we'll have some ancillary 
benefit there, but phase 4 is about the defense of the 
Homeland. It's getting that first shot in early.
    An entirely separate discussion is cost. We all expect 
we're going to have to continue to grow missile defense of the 
Homeland for a long time to come. The proliferation trends are 
clear enough. There's a question of when threats will mature, 
but we don't expect them to stop maturing.
    So we've tried to take a long-term look while ensuring that 
we remain well-protected in the short- and medium-term. So 
strengthening the defense of the Homeland involves addressing 
the technical problems in the GMD system, the results of 
concurrency that we discussed earlier. It involves being well-
hedged against the possibility that we need to put a lot more 
capability into the ground quickly because there's a breakout 
somewhere that would somehow call into question the fact that 
we're already well-protected with 30 GBIs in the ground.
    But looking ahead to the future growth, we'd rather put 
that future growth in two areas: first, improving the 
performance of the existing system. If your shot doctrine is 
four to one, six to one, eight to one, you're much better off 
having a shot doctrine of two to one than buying a whole bunch 
of new GBIs.
    Second, we'd like to put money into the IIB because it 
gives you the opportunity to grow at a much more cost-
affordable way that future capability we're going to need. So 
from our perspective it's not a ransack the GBI budget to go do 
regional missile defense. Rather, it's a strategy for 
strengthening the Homeland defense over the long-term in a way 
that is cost affordable and enhances the performance of the 
system through the addition of this second layer.
    Thank you.
    Senator Nelson. Thank you.
    Dr. Gilmore. Just one additional comment.
    Senator Nelson. Sure.
    Dr. Gilmore. With regard to the GMD test program, the 
content and pace of the GMD test program is essentially the 
same today as it was when I first looked at the integrated 
master test plan when I first took office almost 3 years ago. 
So it is not the case that we have used the GMD test program 
budget to pay for anything else in this budget or in previous 
budgets.
    Senator Nelson. Senator Sessions?
    Senator Sessions. I'll just say this about the SM-3 Block 
IIB. It's not developed, it's not on the assembly line, it's 
not ready to be deployed, it's not a mature technology. We've 
gone from a bird in the hand to two in the bush. You're not 
going to be here probably, Mr. Roberts, and President Obama is 
not going to be here, in 2022, 2023, 2024, whenever this thing, 
if it ever gets funded to conclusion.
    So we've gone from a virtual certainty to a very uncertain 
situation. From a politician who handles the money and knowing 
what we're going to be looking like, that's what we're doing. 
I'm uneasy about it, frankly.
    General O'Reilly, you talked about competition. You had 
some success with competition recently you were sharing with 
me. I was very impressed. Maybe we ought to hear that and what 
your concerns might be if we lose competition in the future.
    General O'Reilly. Sir, we have had a benefit. We've had 
multiple programs. In, first of all, our GMD contract, it was 
over 10 years old. We have recompeted it. We believe because of 
the competition the actual cost of the contract was a billion 
dollars less than the government cost estimate that looked at 
all the factors, and we use history to predict what the cost of 
the contract should be.
    We saw extremely innovative ideas in the company that 
ultimately won, Boeing, in order to save costs and have a very 
effective program.
    There were some other benefits, too. Because we were in a 
competitive situation, it allows the government to make clear 
what its desires are and to ensure that industry is highly 
motivated to respond. For example, our defects clause that's in 
this contract now. Previously, if we had a flight test failure, 
there's a limited amount of award fee money that we had planned 
to award the contractor, given a successful flight. Often, 
though, the failure of a flight can cost many times more than 
that award fee.
    Under the new contract, all of their award fee from the 
moment the contract was first awarded is under consideration, 
rather than just the award fee associated for an event if the 
government determines harm has occurred to the government by a 
failure or something that we determine should have been 
preventable.
    We have great access to data within the program that often 
isn't part of another contract. So we think that the 
competition, sir, has saved in this case $1 billion. We have 
also determined that we've had several others. This isn't the 
only one. We have a trend. Every time we've competed in our 
missile programs and targets programs, the savings has been in 
the hundreds of millions of dollars. This is all over the past 
year alone.
    Senator Sessions. I think that's good news, and I think 
some of the things that we were prepared to pay a lot of money 
for because they were so difficult and unproven, once the 
technology has become available, it's like computers and cell 
phones to some degree; they're just less expensive today. 
Hopefully, we can build on all that good work that's been done 
and the price per copy of a lot of the new systems will be less 
and we can achieve even better capabilities.
    Thank you, Mr. Chairman. This is an important part of 
America's defense. One of the things that I learned a number of 
years ago--when the issue was hot and I asked people at town 
meetings, what would happen if a country launched a missile at 
us, and they said: We'd shoot it down. This was before the GMD 
was in the ground. I think there's a general perception by the 
American people that we have perhaps more capability than we 
do. But we have some people that think the system won't work at 
all, that it's too complex and can't work.
    But the truth is, we are developing a missile defense 
capability that is reliable, that consistently defends America, 
but we need more of them. We need to keep the cost low. I think 
all in all we've accomplished more than a lot of people ever 
thought possible. So I congratulate all of you.
    Senator Nelson. Thank you.
    I have one final question. General O'Reilly, the Aegis BMD 
program had a flight test failure last September during the 
first flight test of the SM-3 Block IB missile, which has 
delayed the scheduled production of that missile, and now it 
requires a plan to fix the problem and demonstrate the fix in 
flight testing. Can you tell us the likely cause, if it's not a 
matter of security, and how you're planning to correct it, and 
give us some indication of the criteria for a production 
decision on it? Do you agree in general that we should 
demonstrate the problem is corrected in flight testing before 
we make a full rate production decision?
    General O'Reilly. Sir, I offer to answer that question in a 
closed session. I can describe the exact reason why we believe 
the failure occurred. I can say we've duplicated it many times 
on the ground. We've proven this is the cause. We fly again 
next month. To answer your question, sir, there were planned 
three flight tests across the summer, and next year three more, 
to firmly address that we have resolved it and flown it in many 
different scenarios before we go for a production decision.
    Senator Nelson. We don't have a getting-the-cart-before-
the-horse situation here at all. You're going through a very 
significant methodology of identifying the problem, with a plan 
to fix it and test it before production; is that fair?
    General O'Reilly. Sir, that is fair, and it's the same 
criteria we set with Dr. Gilmore years ago. The criteria hasn't 
changed. When we have a failure and a problem, we maintain the 
criteria. We just have to be ready to continue on with the 
flight testing.
    So effectively it has delayed the start of the production, 
but again to address risk for EPAA phase 2 which it will be 
used in, that's a 2015 deployment. So we're many years in front 
of it right now.
    Senator Nelson. The delay is just a structural 
technological delay, not as a result of not having enough money 
to be able to do the testing?
    General O'Reilly. No, sir. It's not related to funding.
    Senator Nelson. I want to add my appreciation to all of you 
today. I think we've set a record for an abbreviated hearing, 
but I think if there are other questions we'll be submitting 
them, and the record will remain open until next Tuesday to try 
to get as many questions answered if there are remaining 
questions.
    Thank you very much.
    Senator Sessions. Mr. Chairman, I just would say how much 
I've enjoyed working with you on this. Your leadership, your 
commitment to developing the kind of strategic capability this 
Nation needs to protect us, that's been your goal from the 
beginning. You've been an honest and strong advocate for those 
issues. So it's been a good hearing and I appreciate the 
opportunity to be with you again.
    Senator Nelson. Thank you very much for those kind remarks. 
I'm really glad that you did arrive at the hearing in time to 
be able to make those remarks as well. [Laughter.]
    General Formica. Mr. Chairman, can I make one closing 
thought?
    Senator Nelson. Sure.
    General Formica. I appreciate the discussion today and the 
investment of the technology and the systems that will deliver 
BMD, and we appreciate this committee's support for that. We 
recognize that there will never be enough and so there are 
other opportunities that we have to take in the offense/defense 
mix. But most importantly, we appreciate the support of the 
committee in investing in the soldiers, sailors, airmen, 
marines, and civilians who will operate these systems, and we 
appreciate your commitment to them.
    Senator Nelson. Thank you, and we should never forget them. 
They are essentially what makes this country strong and what 
will help our defense against these kinds of threats.
    So thank you all and thank them for us, too.
    General Formica. Thank you, Senator. I will.

   STATEMENT OF BRADLEY H. ROBERTS, Ph.D., DEPUTY ASSISTANT 
  SECRETARY OF DEFENSE FOR NUCLEAR AND MISSILE DEFENSE POLICY

    [The oral and prepared statements of Dr. Roberts follow:]
                Oral Statement by Dr. Bradley H. Roberts
    Chairman Nelson, Ranking Member Sessions, members of the committee, 
it is my pleasure to appear before you today in support of the 
President's fiscal year 2013 budget request for ballistic missile 
defense (BMD). I have prepared a formal written statement and would 
like to submit that for the record. That statement:

         reviews the key policy priorities as set out in the 
        administration's 2010 Ballistic Missile Defense Review (MDR) 
        and
         describes our progress in advancing three of those 
        goals:

                 sustaining a strong Homeland defense posture
                 strengthening regional defense, and
                 increasing international cooperation for 
                missile defense.

    In these introductory remarks, I would like to focus in on the 
overall balance in our missile defense strategy and investments. 
Specifically, I want to address the concern expressed by some that we 
have put regional defense ahead of Homeland defense.
    On regional defense, in our assessment there is both a need and 
opportunity to strengthen our defensive posture.

         The need arises from the rapidly emerging threats to 
        our forces in Europe, the Middle East, and East Asia from 
        regional missile proliferators and the basic challenge such 
        proliferation poses to the safety and security of our forces 
        and allies and to our power projection strategy.
         The opportunity to strengthen our regional posture 
        arises from the fact that investments made over the last 2-3 
        decades have resulted in effective and affordable protection 
        against these missiles.
         There is also an important knock-on effect for 
        Homeland defense, which can be made more effective with the 
        deployment of some assets closer to the threat.

    Accordingly, we have put in place an investment program to ramp up 
these regional defense capabilities over the years ahead. These 
regional missile defense programs also provide an increasingly 
promising opportunity for burden sharing with our allies and partners. 
They are not along for a free ride.
    Our first priority, however, is and remains Homeland defense. We 
are committed to strengthening the Homeland defense posture and to 
ensuring that it remains overwhelmingly advantageous for the United 
States even in the face of future missile proliferation. Therefore, the 
question is not whether we should continue to strengthen Homeland 
defense--I believe we are in agreement on this--but how best to 
strengthen it.
    A simple way to grow the posture is to put more ground-based 
interceptors (GBI) into the ground, whether at one of the existing 
sites or at a new one. We prefer a different approach, one that relies 
on a pairing of GBIs and Standard Missile-3 (SM-3)-IIBs. Here is our 
case:

    1.  For regional defense, we now have two layers of protection. The 
homeland deserves the same. Depth and redundancy are better than 
reliance on a single system.
    2.  Effectively exploiting the full missile defense battle space 
requires forward and rear basing of interceptors. A shoot-look-shoot 
capability is more effective--and more efficient--with forward 
placement of the first shooter.
    3.  Forward placement of the first shooter becomes even more 
important if and as proliferators field missile defense 
countermeasures.
    4.  A ramp up of SM-3-IIB capability will be much more affordable 
than a ramp up of GBIs. With the SM-3-IIB projected to be roughly one-
third the cost of the GBI, we can grow capability at triple the rate 
for each dollar invested.

    Until the SM-3-IIB becomes available, our focus for Homeland 
defense needs to be on improving the performance of the Ground-based 
Midcourse Defense (GMD) system. Working closely with the Missile 
Defense Agency (MDA), we have determined that significant improvement 
is possible in the performance of the existing GMD system. Indeed, the 
performance can be at least doubled. In essence, we can double the 
number of ICBMs the current force is capable of defeating without 
adding a single new GBI.
    This paired strategy (GBI and SM-3-IIB) for strengthening the 
Homeland defense posture directly informs the work we have had underway 
in the Department of Defense since conclusion of the Ballistic Missile 
Defense Review (BMDR) on how best to hedge against new threats to the 
homeland that could call into question the viability ofthe existing 
posture before the SM-3-IIB becomes available. The hedge analysis has 
informed the budget you are now considering: for example, the proposed 
addition of the east coast data relay center derives from that work, as 
does the decision to keep the GBI production line open. We continue to 
analyze additional steps that might be taken, as well as the 
intelligence information that informs such decisions. No option has 
been ruled out, but nor have we determined a need for additional steps 
at this time. We recognize our obligation to report to you on this work 
in a classified session and are committed to doing so as soon as the 
current cycle of analysis is complete.
    The budget before you reflects this balanced approach to missile 
defense. Approximately one third of that budget is uniquely associated 
with regional missile defense. The rest is either uniquely associated 
with Homeland defense or supports both domains. As a result of the 
Budget Control Act, we have had to accept some additional risk in these 
programs. But the budget before you preserves our full set of 
commitments to homeland and regional defense.
    In sum, in the BMDR we promised:

         a balanced approach and
         an affordable approach that would ensure stronger 
        protection for our forces and allies abroad and effective 
        Homeland defense in both the near-term and longer-term.

    We believe that the current budget effectively supports these 
commitments and hope that it will benefit from your support. I look 
forward to answering your questions.
                                 ______
                                 
              Prepared Statement by Dr. Bradley H. Roberts
                              introduction
    Chairman Nelson, Ranking Member Sessions, and members of the 
subcommittee, thank you for the opportunity to testify in support of 
the Department's fiscal year 2013 budget request for missile defense. 
As the new defense strategy makes clear, ballistic missile defense is a 
key capability for the United States with important ramifications in 
several of the Department's key mission areas.
    In February 2010, the administration completed the statutorily 
required review of missile defense policies and plans, the Ballistic 
Missile Defense Review (BMDR). This comprehensive review set out the 
following key policy priorities:

         First: The United States will continue to defend the 
        homeland against the threat of limited ballistic missile 
        attack.
         Second: The United States will defend against regional 
        missile threats to U.S. forces, while protecting allies and 
        partners--and enabling them to defend themselves.
         Third: Before new capabilities are deployed, they must 
        undergo testing that enables assessment under realistic 
        operational conditions.
         Fourth: The commitment to new capabilities must be 
        fiscally sustainable over the long term.
         Fifth: Ballistic Missile Defense (BMD) capabilities 
        must be flexible enough to adapt as threats change.
         Sixth: The United States will seek to lead expanded 
        international efforts for missile defense.

    A year ago, we provided you an update on the status of our efforts 
to implement these policies. That testimony highlighted our progress 
with our North Atlantic Treaty Organization (NATO) allies in 
implementing the European Phased Adaptive Approach (EPAA).
    This year I would like to focus on our progress in three key areas: 
sustaining a strong Homeland defense, strengthening regional missile 
defense, and fostering increased international cooperation.
                  sustaining a strong homeland defense
    On Homeland defense, our policy is informed by the following key 
judgments:

         The homeland is currently protected against potential 
        limited intercontinental ballistic missile (ICBM) attacks from 
        states like North Korea and Iran. This is a result of the 
        steady progress over the past decade in developing and 
        deploying the Ground-based Midcourse Defense (GMD) system. This 
        system consists of Ground-Based Interceptors (GBIs), early-
        warning radars, sea-based radar systems, and a sophisticated 
        command and control architecture. With 30 GBIs in place, the 
        United States is in an advantageous position vis-a-vis the 
        threats from North Korea and Iran. Although both countries have 
        active programs to develop long-range ballistic missiles and 
        space-launch vehicles, most recently evidenced by North Korea's 
        failed attempt to launch a Taepo Dong-2 missile, neither has 
        successfully tested an ICBM or demonstrated an ICBM-class 
        warhead.
         Maintaining this advantageous position is essential. 
        This requires continued improvement to the GMD system, 
        including enhanced performance by the GBIs and the deployment 
        of new sensors. It also requires the development of the 
        Precision Tracking Space System (PTSS) to handle larger raid 
        sizes and the Standard Missile-3 (SM-3) Block IIB as the ICBM 
        threat from states like Iran and North Korea matures. These 
        efforts will help to ensure that the United States possesses 
        the capability to counter the projected threat for the 
        foreseeable future.
         The United States must also be well hedged against the 
        possibility that new threats may emerge so rapidly as to call 
        into question the currently advantageous position. It is also 
        prudent for the United States to have a hedge strategy to 
        address possible delays in the development of our missile 
        defense. Key elements of the hedge strategy were set out in the 
        BMDR 2 years ago, including completion of the second field of 
        14 silos at Fort Greely, AK. This increases the availability of 
        silos in the event that additional GBI deployments become 
        necessary. Additionally, we continue to develop the two-stage 
        GBI. In addition, the BMDR conveyed the administration's 
        commitment to pursue additional programs to hedge against 
        future uncertainties.

    The commitment to continued improvement of the GMD system is 
reflected in budget requests to:

         Implement an aggressive GBI reliability improvement 
        program;
         Deploy forward-based AN/TPY-2 radars;
         Develop the Precision Tracking Space System;
         Upgrade the Command, Control, Battle Management, and 
        Communications (C2BMC) system;
         Emplace an additional In-Flight Interceptor 
        Communications System Data Terminal on the U.S. East Coast; and
         Upgrade the Early Warning Radars at Clear, AK, and 
        Cape Cod, MA, by 2017; and
         Accelerate C2BMC development and discrimination 
        software to handle larger raid sizes.

    These improvements in sensor coverage, command and control, and 
interceptor reliability will have a significant impact on the expected 
performance of the GMD system. Their net effect will be to reduce the 
number of GBIs required per intercept, which will increase the number 
of ICBMs that can be defeated by the GMD system.
    The commitment to the SM-3 IIB as part of the longer-term solution 
is reflected in a request for a renewal of full funding for its 
development. Due to congressional actions , the SM-3 IIB program has 
been delayed by a year. The SM-3 IIB interceptor is now scheduled to be 
available for deployment in 2021 timeframe. When deployed in Europe, 
the SM-3 IIB will provide an opportunity for early intercept of 
potential Iranian ICBMs. This will also provide the United States with 
an additional type of interceptor for defeating ICBMs.
    The commitment to being well hedged is reflected in a request to 
purchase an additional five GBIs. This will ensure the capability to 
emplace additional missiles rapidly in Missile Field 2, if necessary. 
It will also maintain enough GBIs for testing and operational spares. 
This decision also keeps the GBI production line ``warm'' in case the 
purchase of additional GBIs is needed in the future. These decisions 
follow the Department's commitment to pursue ``additional programs to 
hedge against future uncertainty,'' as stated in the 2010 BMDR Report. 
To support those decisions, the Department is conducting a 
comprehensive review of possible future developments in the threat and 
of how best to ensure timely response to currently unpredicted 
developments. The Department will provide a classified summary of this 
work to the Subcommittee.
                  strengthen regional missile defenses
    On regional missile defense, our policy is informed by the 
following key judgments:

         After a decade of significant progress in developing 
        and fielding capabilities for protection against short- and 
        medium-range ballistic missiles, the United States is capable 
        now of significantly strengthening protection of its forces 
        abroad and assisting its allies and partners in providing for 
        their own defense.
         The need to strengthen protection significantly is 
        clear, as the threat is rapidly expanding in regions where the 
        United States offers security assurances.
         Fixed architectures lack the flexibility to meet rapid 
        and unexpected developments in the regional missile threat, so 
        a more flexible approach is needed.
         Regional approaches must be tailored to the unique 
        deterrence and defense requirements of each region, which vary 
        considerably in their geography, history, and character of the 
        threat faced, and in the military-to-military relationships on 
        which we seek to build cooperative missile defenses.
         Because the demand for missile defense assets within 
        each region over the next decade will exceed supply, the United 
        States will develop capabilities that are mobile and 
        relocatable.
         Missile defense is an integral part of a comprehensive 
        U.S. effort to strengthen regional deterrence architectures. It 
        plays a central role in the new strategic guidance the 
        Department released in January 2012.
         Regional missile defense architectures are not meant 
        as a substitute for the defense of the homeland. However, over 
        time they can become effective means to that end if threats to 
        the homeland appear in specific regions as states like Iran and 
        North Korea develop and deploy intercontinental-range 
        capabilities.

    The BMDR set out this new policy framework and committed the United 
States to pursue a phased adaptive approach (PAA) to missile defense 
within each region. The 2010 BMDR Report set out in detail the first 
regional application--in Europe. It also indicated that the approach 
would be applied in East Asia and the Middle East. A short summary of 
our progress on each of these projects follows.
                       paa implementation: europe
    A year ago, we were pleased to be able to report to you substantial 
progress within NATO in support of missile defense. At the November 
2010 NATO Summit in Lisbon, NATO Heads of State and Government had 
taken the unprecedented step of deciding to put in place full coverage 
and protection for the Alliance's European populations, territories, 
and forces against ballistic missile attacks. NATO also decided at 
Lisbon to expand its existing missile defense command-and-control 
backbone--the Active Layered Theater Ballistic Missile Defense 
(ALTBMD)--to encompass territorial missile defense. ALTBMD's initial 
capability is now in place, and will continue to evolve towards full 
capacity in 2018. EPAA will be the U.S. contribution to NATO missile 
defense. More than 1 year ago, the first deployment of EPAA 
capabilities came when the guided missile cruiser USS Monterey, 
carrying SM-3 interceptors, deployed to Europe in March 2011.
    We also have continued to make steady progress in implementing all 
four phases of the EPAA.
    The elements of the first phase of EPAA are now in place. As noted, 
Phase 1 began with deployment of the first BMD-capable ship in March 
2011. We have continued to maintain a sea-based missile defense 
presence in the region since that time. In August of 2011, Turkey 
announced that it would host the forward-based radar as part of NATO's 
missile defense plan. By the end of 2011, the radar was deployed to the 
Turkish military base at Kurecik. Additionally, associated command and 
control capabilities are now operational, such as the U.S. Air 
Operations Center at Ramstein Air Base, Germany. Also of note, ALTBMD's 
interim capability is operational, and will continue to evolve towards 
full capability in the 2018-2020 timeframe.
    In Phase 2, the architecture will be expanded with a land-based SM-
3 site, or Aegis Ashore, in Romania, and with SM-3 Block IB 
interceptors that will be deployed on land and at sea. The Ballistic 
Missile Defense Agreement (BMDA) with Romania entered into force in 
December 2011, so the groundwork has been set for the site to become 
operational in the 2015 timeframe.
    In Phase 3, a second land-based SM-3 site will be deployed in 
Poland. The more capable SM-3 Block IIA interceptors will be deployed 
on land and at sea, extending coverage to all NATO European countries. 
The Polish BMDA entered into force in September 2011.
    Finally, with respect to Phase 4, the Department has begun concept 
development of a more advanced version of the SM-3 interceptor, the 
Block IIB, for deployment in the 2021 timeframe. This interceptor will 
be an especially important enhancement to the EPAA because Iran 
continues to develop ballistic missiles that are capable of threatening 
all of NATO Europe and the technology needed to field an ICBM that 
could threaten the U.S. Homeland. The SM-3 IIB will be the most capable 
interceptor for addressing intermediate-range ballistic missile (IRBM) 
threats to Europe and will enhance the protection of the United States 
by providing an early shot against an Iranian ICBM headed towards the 
U.S. Homeland.
    We have also taken steps to resource the requirement for sea-based 
BMD capabilities efficiently in all phases of the EPAA. Spain has 
agreed to host four U.S. Aegis destroyers at the existing naval 
facility at Rota. These multi-mission ships will support the EPAA, as 
well as other U.S. European Command and NATO maritime missions. The 
first two ships are scheduled to arrive in 2014, and two more ships 
will arrive in 2015.
                          nato missile defense
    As we continue to implement the EPAA, we are also supporting the 
President's commitment to contribute the EPAA capabilities to NATO 
missile defense. The U.S. decision to implement the EPAA in a NATO 
context was instrumental in building a strong consensus among the 
allies in support of missile defense.
    NATO is now focusing on defining the command and control procedures 
that will guide how NATO missile defense will operate. At the May 2012 
NATO Summit in Chicago, the United States and the allies plan to 
declare that NATO has achieved an ``Interim BMD Capability.''
    In essence, this will mean that each nation's missile defense 
contributions, including the U.S. EPAA assets, will operate under the 
same ``playbook'' developed and agreed by allies. Much of this work has 
already been completed, and the United States will continue to support 
and guide these efforts to ensure that NATO missile defense procedures 
result in the most effective and efficient missile defense protection 
of NATO European populations, territory, and forces possible.
    As the EPAA continues to evolve, so will NATO missile defense. In 
the coming years, NATO will work towards future milestones for 
territorial missile defense. NATO is fully engaged in developing the 
details necessary to implement fully the alliance missile defense 
decisions announced at the Lisbon Summit. Key enhancements of the 
future NATO missile defense capability will include:

         Engagement coordination among allies to ensure the 
        most efficient defense;
         Real-time sharing of engagement-quality data to 
        improve the chances of engagement success;
         The ability to coordinate and manage ``upper-layer'' 
        missile defense capabilities (defense against longer-range 
        threats).

    As a result, NATO's capacity to accommodate and coordinate 
additional allied contributions will grow. Meanwhile, the United States 
will continue to deploy all four phases of the EPAA as a contribution 
to NATO missile defense.
    There are still some complicated issues that must be resolved, as 
there are with any new capability at NATO, but the work is being driven 
by the political consensus achieved at Lisbon. The allies agree that 
the ballistic missile threat to NATO is growing more urgent, not less. 
Furthermore, we agree that missile defense is a critical new capability 
in order to meet this threat and adapt to the evolving 21st century 
security landscape.
              phased adaptive approaches in other regions
    We are also working to implement the principles of the phased 
adaptive approach in the Asia-Pacific region and the Middle East, 
building on the existing foundations of U.S. defense cooperation in 
these regions. These regional approaches must be tailored to the unique 
mix of threat and geography in each region. In Asia, the security 
environment is largely maritime in character, with some vast distances. 
The Middle East is far more compact, and the threat comes from missiles 
of short and medium range. Moreover, the footprint of U.S. military 
presence is different in each region, and will evolve in different ways 
over the coming decade. The potential threat to the U.S. Homeland from 
regional actors varies, and with it requirements for the role that 
regional defenses play in protection of the United States change as 
well.
    These regional approaches to ballistic missile defense should allow 
strong partnerships with regional allies and partners in meeting 
emerging security challenges, and provide opportunities for building 
partner capacity.
                strengthening international cooperation
    There has been significant progress in the area of international 
cooperation on missile defense. Let me highlight a few areas of 
particular note.
Europe
    Within NATO, allies are stepping up as contributors to the NATO 
missile defense effort. Germany and the Netherlands currently field 
Patriot PAC-3, Greece and Spain operate Patriot PAC-2, and France and 
Italy have the SAMP/T system, which has capabilities similar to those 
of the Patriot.
    Other allies plan to commit additional capabilities to contribute 
to NATO missile defense. The Netherlands has approved plans and funding 
to upgrade the SMART-L radar on four air defense frigates, giving the 
ships a BMD sensor capability. Additional sensor capabilities can 
greatly enhance the effectiveness of a BMD architecture. Germany is 
also exploring airborne sensor concepts that could support NATO BMD. In 
addition, France has proposed a concept for a shared-early warning 
satellite, and is developing a transportable midcourse radar for BMD 
and early warning.
    NATO allies have shown their financial, political, and military 
support for the implementation of EPAA and NATO missile defense in 
other ways. The commitment to upgrade the ALTBMD command and control 
system noted above was backed with an alliance funding commitment. 
Turkey, Romania, Poland, and Spain have all agreed to host U.S. assets 
in support of NATO missile defense. These host governments will bear 
the costs of providing perimeter defense and security for the U.S. 
assets and infrastructure.
    Looking to the future, the United States will continue to encourage 
its NATO allies to do even more to cooperate and invest in missile 
defense. Several allies have modern surface combatant ships that could 
be upgraded with a BMD sensor or shooter capability. A number of NATO 
allies also have proposed concepts for a multinational interceptor 
``pool'' concept, whereby allies collectively purchase interceptors 
such as the SM-3 to support NATO missile defense. Additionally, some 
allies are considering the purchase of Patriot PAC-3.
Asia-Pacific
    In the Asia-Pacific region, Japan has acquired its own layered 
missile defense system, and the United States and Japan regularly train 
together, learn from each other, and have successfully executed 
cooperative BMD exercises and operations. The United States and Japan 
are also partnering in the co-development of an advanced version of the 
SM-3 interceptor, the SM-3 Block IIA.
    The United States and Australia signed a memorandum of 
understanding on missile defense cooperation in 2004 and partner on 
ballistic missile defense research and development, most notably in the 
field of sensors.
    The United States also continues to consult with the Republic of 
Korea regarding its future ballistic missile defense requirements.
    The United States engages in a trilateral dialogue with Japan and 
Australia, and separate trilateral dialogue with Japan and the Republic 
of Korea. In each, we address a wide range of regional security issues, 
including missile threats and defenses. These trilateral dialogues 
support U.S. efforts to deepen missile defense cooperation and 
strengthen regional security architectures.
Middle East
    The United States and Israel cooperate extensively on missile 
defense issues. We have a long history of cooperation on plans and 
operations as well as specific missile defense programs. We hold 
regular consultations, and have conducted joint exercises since 2001 
that are aimed at improving interoperability between U.S. and Israeli 
missile defense systems. In 2008, our countries worked together to 
deploy a forward-based radar in Israel to enhance U.S. and Israeli 
missile detection capabilities. U.S. support to the security of Israel 
remains steadfast. U.S. security assistance to Israel has increased 
every year since fiscal year 2009. The administration has requested 
nearly $450 million for Israeli rocket and missile defense between 
fiscal year 2010 and 2013 and secured an additional $205 million in 
fiscal year 2011 to procure Iron Dome defense systems.
    Separately, the United States is working with a number of Gulf 
Cooperation Council (GCC) countries on missile defense, including 
exploring the purchase of U.S. missile defenses through the Foreign 
Military Sales (FMS) program. For example, the United Arab Emirates 
(UAE) recently signed an FMS case to purchase Terminal High Altitude 
Aerial Defense (THAAD) batteries, interceptors, and associated 
equipment, and had earlier made a decision to purchase Patriot systems 
from the United States. These systems will greatly enhance the UAE's 
defense against ballistic missile attack. As our partners acquire 
greater missile defense capabilities, the United States will work to 
promote interoperability and information sharing among the GCC states. 
This will allow for more efficient missile defenses and could lead to 
greater security cooperation in the region.
    A primary purpose of the phased adaptive approaches to regional 
missile defense is to build upon this solid foundation of cooperation 
in each of these regions to achieve needed protection improvements over 
the coming decade.
Russia
    The United States has sought cooperation with Russia on missile 
defense, both bilaterally and with our allies through the NATO-Russia 
Council. We are pursuing this cooperation because it would be in the 
security interests of the United States, NATO, and Russia by 
strengthening the defensive capabilities of both NATO and Russia. 
Allies embraced such cooperation with the hope of advancing broader 
strategic partnership with Russia. The United States has pursued 
missile defense cooperation with Russia with the clear understanding 
that we would not accept constraints on missile defense, we would 
implement all four EPAA phases, and Russia would not have command and 
control over the defense of NATO territory. NATO would be responsible 
for the defense of NATO, and Russia would be responsible for the 
defense of Russia.
    The United States has kept Congress and our allies informed about 
our efforts to reach agreement with Russia to cooperate on missile 
defense, which have included the proposal of two missile defense 
cooperation centers in Europe. The United States has been open and 
transparent with Russia about our plans for missile defenses in Europe, 
and explained our view that missile defense in Europe does not negate 
the Russian strategic nuclear deterrent.
    Although we have had no breakthroughs, the administration remains 
committed to pursuing substantive missile defense cooperation with 
Russia because it remains in our security interests to do so and, as 
President Medvedev noted in a statement last fall, Russia indicates 
that it remains open to further discussions and seeks a mutually 
acceptable agreement on the way forward.
              the president's budget for fiscal year 2013
    The fiscal year 2013 budget requests $9.7 billion in fiscal year 
2013 and $47.4 billion over the next 5 years to develop and deploy 
missile defense capabilities that protect the U.S. Homeland and 
strengthen regional missile defenses. This number is less than last 
year's request, but it nevertheless demonstrates a continued high-level 
commitment to developing cost-effective missile defense capabilities 
while maintaining our commitments to homeland and regional defense. The 
phased adaptive approach to regional missile defense is fully in line 
with the main themes of U.S. defense strategy in a period of budget 
austerity.
    This approach puts emphasis on a flexible military toolkit with 
forces that are mobile and scaleable so that they underwrite deterrence 
in peacetime, but can be surged in crisis to support additional 
warfighter requirements.
    On Homeland defense, the budget takes advantage of savings from the 
GMD system competition, while continuing to improve the performance of 
the system and at the same time hedging against uncertainty. With 
regard to regional missile defenses, the budget request continues to 
increase the pool of mobile, relocatable assets for the phased adaptive 
approaches--but at a somewhat slower rate. This budget includes the 
purchase of an additional THAAD battery, an AN/TPY-2 radar, and SM-3 IB 
interceptors, as well as the conversion of 3 Aegis ships to bring the 
total number of BMD-capable ships to 32. The budget also includes $46.9 
million for directed energy research. The budget forced us to make 
difficult choices that entail some risk. However, the missile defense 
capabilities we are pursuing enable us to field a force that is 
flexible and adaptive, and that can surge to meet the requirements of 
an uncertain future.
    The fiscal year 2013 budget request also includes funding for the 
SM-3 IIB and PTSS, two programs that faced congressional reductions in 
the previous budget that will cause delays in their deployment 
timelines. These programs are vital to addressing the long-term threats 
from regional actors such as Iran and North Korea, so slips in the 
program schedules due to budget reductions introduce additional risk. 
The SM-3 IIB will provide improved protection against IRBM threats as 
well as supplement the protection of the homeland provided by the GMD 
system against ICBM threats with a significantly lower cost interceptor 
than the GBI. PTSS will also contribute to both homeland and regional 
missile defense by providing persistent coverage and tracking of 
ballistic missiles over their entire flights and address larger raid 
sizes. This will improve the performance of our missile defenses by 
providing better data to the interceptors and allowing us to allocate 
terrestrial sensor resources more efficiently.
                               conclusion
    With your support, we have been able to make significant progress 
in strengthening the protection of the United States, our forces, and 
our allies and partners abroad from the threat of coercion and attack 
by ballistic missiles. We appreciate congressional support for the 
President's missile defense annual budget requests, and in these more 
austere budget times, we hope for your continued support. We have had 
to make some difficult choices in this year's budget, but the result is 
fully consistent with the policy commitments set out in the BMDR.
    Again, thank you for the opportunity to speak here today before the 
members of this subcommittee. I look forward to answering your 
questions.

 STATEMENT OF LTG PATRICK J. O'REILLY, USA, DIRECTOR, MISSILE 
                         DEFENSE AGENCY

    [The oral and prepared statements of General O'Reilly 
follow:]
             Oral Statement by LTG Patrick J. O'Reilly, USA
    Good afternoon, Chairman Nelson, Ranking member Sessions, and other 
distinguished members of the subcommittee. The Missile Defense Agency's 
(MDA) $7.75 billion fiscal year 2013 President's budget request 
balances: the Secretary of Defense's policies; U.S. Strategic Command's 
Missile Defense Priorities; the MDA's technical feasibility 
assessments; budget affordability; and Intelligence Community 
estimates. I describe our past year's accomplishments and justification 
of this year's budget request in my written statement submitted to this 
committee. However, I'd like to highlight that last year we improved 
our Homeland defense by activating our newest missile field and an 
additional fire control node at Fort Greely, AK, and an Upgraded Early 
Warning Radar in Thule Greenland. The agency's highest priority is to 
intercept a missile with the newest version of our Ground-Based 
Interceptor (GBI) after two previous flight test failures. We conducted 
a failure review by renowned experts, redesigned critical GBI 
components, and established more stringent component manufacturing 
requirements. We incurred delays meeting those stringent requirements, 
but we will not execute flight tests until our engineers and 
independent experts are convinced that we have resolved all issues. We 
anticipate our next non-intercept flight test by the end of this year 
to verify issue resolution and then conduct an intercept flight test 
early next year before we re-activate the GBI production line. This 
year, we will also activate our hardened power plant at Fort Greely, 
AK, and we will increase the firepower of fielded GBIs by upgrading the 
reliability of GBI components. Finally, we continue to enhance the Sea-
Based X-band radar, but we have cost-effectively limited its operations 
to flight testing and contingency deployments under the command of the 
Navy's Pacific Fleet.
    During the past year we: deployed on-time the first phase of the 
European Phased Adaptive Approach, demonstrated an Aegis intercept of a 
3,700 km target, and simUltaneously intercepted two missiles with the 
Terminal High Altitude Area Defense (THAAD) system. This year, the 
first two THAAD batteries will be available for deployment; the number 
of total Aegis BMD capable ships will reach 29; we will conduct three 
SM-3 Block IB flight tests to demonstrate the resolution of last year's 
flight test failure; and we will conduct the largest missile defense 
test in history by simultaneously intercepting three ballistic missiles 
and two cruise missiles with an integrated Patriot, THAAD. Aegis BMD 
and forward based radar systems. We also continue to work with over 20 
countries. including cooperative development programs with Israel and 
Japan, the first foreign military sale of THAAD to the UAE, and support 
discussions with the Russians on cooperative missile defense.
    I am concerned about developing the critically needed, persistent, 
and cost effective missile tracking capability of the Precision 
Tracking Space System and developing a second, independent, and layer 
of Homeland defense with the SM-3 IIB interceptor due to fiscal year 
2012 congressional funding reductions to both programs. These programs 
allow our homeland to benefit from the same layered missile defense 
approach we successfully employ for our regional defenses.
    Finally, while some concurrency of development, test, and limited 
production is needed to sustain our industry base during testing, I 
concur with the Government Accountability Office's (GAO) recent report 
that concurrency must be balanced with program and technical risk. We 
already implemented six of the seven GAO recommendations prior to the 
GAO's review. For example, GMD schedule concurrency was high risk, but 
in 2009 and 2010 we reviewed the risks and reduced the schedule 
concurrency of the SM-3 IB and SM-3 IIA programs. However, I disagree 
that the European Phased Adaptive Approach (EPAA) program schedules are 
driven by Presidential directed dates. EPAA programs have risk-based 
concurrency; knowledge-based program decisions, and historically-based 
schedules. Finally, causes of the GBI flight test failures were 
workmanship and unknown flight environments, not schedule concurrency.
    Thank you and I look forward to the committee's questions.
                                 ______
                                 
           Prepared Statement by LTG Patrick J. O'Reilly, USA
    Good afternoon, Chairman Nelson, Ranking Member Sessions, other 
distinguished members of the subcommittee. I appreciate the opportunity 
to testify before you today on the Missile Defense Agency's (MDA) $7.75 
billion fiscal year 2013 budget request to develop protection for our 
Nation, our Armed Forces, allies, and partners against the 
proliferation of increasingly capable ballistic missiles. The 
Department developed the fiscal year 2013 President's budget request in 
accordance with the February 2010 Ballistic Missile Defense Review 
(BMDR), which balanced warfighter needs as expressed in the U.S. 
Strategic Command (STRATCOM) Integrated Air and Missile Defense (IAMD) 
Prioritized Capability List (PCL) with technical feasibility and 
affordability constraints and Intelligence Community updates. We 
continue to demonstrate and improve the integration of sensor, fire 
control, battle management, and interceptor systems that transforms 
individual missile defense projects into a Ballistic Missile Defense 
System (BMDS) capable of defeating large raids of a growing variety of 
ballistic missiles over the next decade. For Homeland defense, last 
year we completed the construction of the Ground-based Midcourse 
Defense (GMD) infrastructure for protection of the U.S. Homeland 
against future limited intercontinental ballistic missile (ICBM) 
threats from current regional threats including the activation of our 
newest hardened missile field at Fort Greely, AK (FGA). This year, we 
will continue to aggressively pursue the Agency's highest priority--
successful return to flight and intercept tests of the Capability 
Enhancement II (CE II) version of the Ground-Based Interceptor (GBI). 
We will prepare for the next GMD non-intercept flight test by the end 
of this year and our next intercept early in the following year, 
activate the hardened power plant at FGA, prepare to restart the GBI 
production line, and aggressively conduct component testing and 
refurbish currently deployed missiles to test and improve their 
reliability. For regional defenses, last year we deployed Phase 1 of 
the European Phased Adaptive Approach (EPAA) consisting of a command 
and control, battle management system in Germany, forward-based radar 
in Turkey, and an Aegis Ballistic Missile Defense (BMD) ship in the 
Eastern Mediterranean Sea. This year, we will have 2 operational THAAD 
batteries, convert 5 Aegis ships and upgrade 1 for a total of 29 ships 
with BMD capability installed, and increase the number of associated 
SM-3 interceptors. In our test program, we will conduct three flight 
tests of the SM-3 Block IB to demonstrate resolution of last year's 
flight test failure and its ability to intercept complex short-range 
ballistic missile (SRBM) (up to 1,000km) targets. Finally, this year we 
will demonstrate the maturity of our layered regional defense with the 
first simultaneous intercepts of three short- and medium-range 
ballistic missiles (MRBM) and two cruise missiles by an integrated 
architecture of Patriot Advanced Capability (PAC)-3, THAAD, and Aegis 
BMD systems assisted by a remote AN/TPY-2 forward based radar--the 
largest, most complex, live fire missile defense test in history.
                       enhancing homeland defense
    MDA's highest priority is the successful GMD intercept flight test 
of the newest GBI Exo-atmospheric Kill Vehicle (EKV)--the CE II EKV. 
Last year, we concluded the Failure Review Board (FRB) evaluation for 
the December 2010 FTG-06a flight test by identifying the most probable 
cause of the failure and revising the CE II EKV design to correct the 
problem. As a result of that FRB, we have redesigned critical GBI Exo-
atmospheric Kill Vehicle (EKV) components and established more 
stringent manufacturing and component test standards--standards 
previously not used anywhere in the U.S. aerospace industry. As a 
result of these stringent manufacturing standards, we have encountered 
several delays in preparing for our next non-intercept and intercept 
flight tests. MDA is fully committed to test the GMD system as soon and 
often as possible, but we will not approve executing a flight test 
until our engineers, and independent government and industry experts, 
have been convinced that we have resolved all issues discovered in 
previous testing and will be successful in our next test. Flight 
testing as often as possible is our goal, but we risk further failure 
if we conduct GMD testing prior to verification that we resolved 
problems discovered in previous flight tests. Also, conducting flight 
tests at a pace greater than once a year prohibits thorough analysis of 
pre-mission and post-mission flight test data and causes greater risk 
of further failure and setbacks to developing our Homeland defense 
capability as rapidly as possible. If our CE II non-intercept 
(Controlled Test Vehicle (CTV) flight) is not successful later this 
year, we will be prepared to conduct the next test of the previous 
version of the EKV (the CE I EKV) GBI test while we continue to resolve 
any CE II issues in order to continue to test other improvements in our 
Homeland defense. Other improvements to Homeland defense include: the 
upgrades and integration of the Thule Early Warning Radar into the BMDS 
to view and track threats originating in the Middle East; upgrade of 
three emplaced FGA GBIs as part of our ongoing GMD fleet refurbishment 
and reliability enhancement program; fielding improved GMD fire control 
software to allow testing or exercises to be conducted while 
simultaneously controlling the operational system; and upgrading the 
FGA communications system. We activated Missile Field 2 earlier this 
year, thus increasing the number of total GBI operational silos to 38 
(34 at FGA and 4 at Vandenberg Air Force Base ((VAFB)) in California). 
This past December, we awarded the GMD Development and Sustainment 
contract, one of the Agency's largest and most complex competitive 
acquisitions, with a price of almost $1 billion less than the 
independent government cost estimate. For the next 7 years, this $3.5 
billion contract will provide for sustainment and operations as well as 
improvements and enhancements of the current capability, provide for a 
robust and vigorous testing program, and deliver new and upgraded 
interceptors. A key part of the scope of this new contract is 
comprehensive verification and reliability testing, and upgrades as 
needed, of every component of our GBIs. These component reliability 
improvements and tests will require 3 years to complete and will 
provide the U.S. Northern Command (NORTHCOM) commander convincing GBI 
reliability data resulting in a greater number of ICBMs that can be 
engaged with a higher probability of protection of our homeland.
    We are requesting $903.2 million in fiscal year 2013 in RDT&E 
funding for the GMD program. We plan to continue to upgrade our fleet 
of 30 operational GBIs and acquire 5 additional GBIs for enhanced 
testing, stockpile reliability, and spares, for a total of 57 GBIs. We 
will continue GBI component vendor requalifications for the future GBI 
avionics upgrade and obsolescence program.
    Today, 30 operational GBIs protect the United States against a 
limited ICBM raid size launched from current regional threats. If, at 
some point in the future, this capability is determined to be 
insufficient against a growing ICBM threat, it is possible that we can 
increase the operational GBIs' fire power by utilizing all 38 
operational silos, refurbishing our 6-silo prototype missile field, and 
accelerating the delivery of new sensor and interceptor capabilities. 
Additionally, our GBI reliability improvement program will enable more 
successful intercepts with fewer GBIs with the same probability of 
successful intercept. In fiscal year 2013, we will begin construction 
of the GBI In-Flight Interceptor Communication System (IFCS) Data 
Terminal (IDT) at Fort Drum, New York, with a completion date by 2015. 
The East Coast IDT will enable communication with GBIs launched from 
FGA and VAFB over longer distances, thus improving the defense of the 
eastern United States. We will also continue to develop and assess the 
two-stage GBI to preserve future deployment options, including an 
intercept flight test in fiscal year 2014.
    Because the defense of our homeland is our highest priority, we are 
pursuing a layered defense concept--similar to that in regional missile 
defense--to achieve high protection effectiveness by deploying more 
than one independently developed missile defense interceptor system; 
therefore, we will continue development of the SM-3 Block IIB to 
protect our homeland in the future by creating a new first layer of 
intercept opportunities, expanding the forward edge of our Homeland 
defense battle space, and providing our warfighters highly feasible 
``Shoot-Assess-Shoot (SAS)'' firing doctrine. The recent Defense 
Science Board (DSB) agreed with our assessment that the SM-3 IIB will 
be challenged to destroy ICBMs before their earliest possible 
deployment of countermeasures. The DSB also supports MDA's development 
of the SM-3 IIB to significantly expand the forward edge of our ICBM 
battle space and enable SAS to obtain very high levels of ICBM 
protection of our homeland. The fiscal year 2012 congressional 
reduction of the SM-3 IIB funding has increased the challenge of 
fielding this improvement in Homeland Defense against ICBMs in the 2020 
timeframe. My additional concern is the impact of reducing funding for 
the SM-3 IIB will eliminate the only new interceptor design and 
development opportunity for our Nation's missile defense industrial 
base for the foreseeable future. The three SM-3 IIB industry teams lead 
by Lockheed Martin, Boeing and Raytheon have shown rapid progress in 
developing very effective and feasible SM-3 IIB interceptor design 
concepts. To terminate, or slow down, the SM-3 IIB development effort 
will have a significant negative impact on missile defense aerospace 
industrial base at this time and risk our ability to cost-effectively 
respond to emerging regional ICBM threats to our homeland for decades 
in the future.
    This year, we will begin upgrading the Clear Early Warning Radar in 
Alaska for full missile defense capability by 2016. We will also 
continue operations of the Sea-Based X-band (SBX) radar and development 
of algorithms to improve its discrimination capability. We are 
requesting $347.0 million in fiscal year 2013 for BMDS Sensors 
development for Homeland defense, including support of the Cobra Dane 
radar, the Upgraded Early Warning Radars (UEWRs) at Beale AFB 
(California), Fylingdales (United Kingdom), and Thule (Greenland). We 
are requesting $192.1 million to operate and sustain these radars and 
$227.4 million to procure additional radars and radar spares. In fiscal 
year 2013, we will also place the SBX in a limited test operations 
status for affordability reasons, but we will be prepared to activate 
the SBX if indications and warnings of an advanced threat from 
Northeast Asia become evident. We will also continue to upgrade the GMD 
system software to address new and evolving threats, including 
enhancing EKV discrimination algorithms by 2015, improving GBI 
avionics, and increasing GBI interoperability with the Command and 
Control, Battle Management and Communications (C2BMC) system.
                       enhancing regional defense
    This year, we will demonstrate integrated, layered regional missile 
defense in the largest, most complex missile defense test ever 
attempted. We will simultaneously engage up to five air and ballistic 
missile targets with an Aegis, THAAD, Patriot and Forward Based Mode 
AN/TPY-2 radar integrated C2BMC system operated by soldiers, sailors, 
and airmen from multiple Combatant Commands. This live-fire test will 
allow our warfighters to refine operational doctrine and tactics while 
providing confidence in the execution of their integrated air and 
missile defense plans.
    Last year, in addition to deploying EPAA Phase 1, we successfully 
supported negotiations for host nation agreements to deploy Aegis 
Ashore batteries to Romania (Phase 2) and Poland (Phase 3); we 
successfully tested the NATO Active Layered Theater Ballistic Missile 
Defense (ALTBMD) Interim Capability with EUCOM C2BMC to enhance NATO 
situational awareness and planning; we installed the Aegis BMD 3.6.1 
weapon system on 3 Aegis ships and upgraded one Aegis BMD ship to Aegis 
BMD 4.0.1 (increasing the Aegis BMD fleet to 22 operationally 
configured BMD ships); and we delivered 19 SM-3 Block IA interceptors 
and the first SM-3 Block IB interceptor. We continued SM-3 Block IIA 
system and component Preliminary Design Reviews. We delivered 11 
interceptors for THAAD Batteries 1 and 2 and flight test, and started 
production of Batteries 3 and 4. We also delivered the latest C2BMC 
upgrades to Northern Command, Strategic Command, Pacific Command, and 
Central Command. These software builds will improve situational 
awareness, sensor management, and planner functions.
    We also demonstrated critical BMDS regional capabilities in key 
tests over the past year. In April 2011, we conducted an Aegis BMD 
flight test (FTM-15) using the SM-3 Block IA interceptor launched using 
track data from the AN/TPY-2 radar passed through the C2BMC system to 
intercept an Intermediate-Range Ballistic Missile (IRBM), target 
(3,000km to 5,500km) to demonstrate the EPAA Phase 1 capability. This 
mission also was the first Launch-on-Remote Aegis engagement and 
intercept of an IRBM with the SM-3 Block IA. In October 2011, the BMDS 
Operational Test Agency (OTA), with the oversight of the Director, 
Operational Test & Evaluation, conducted a successful Initial 
Operational Test & Evaluation test (FTT-12) of THAAD's ability to 
detect, track, and engage SRBM and MRBM targets simultaneously.
Enhanced MRBM Defense in Europe by 2015 (EPAA Phase 2)
    Our goal in this phase is to provide a robust capability against 
SRBMs and MRBMs by deploying several interceptors to engage each threat 
missile multiple times in its flight. The architecture includes the 
deployment of the Aegis BMD 5.0 weapon systems with SM-3 Block IB 
interceptors at sea and at an Aegis Ashore site in Romania. When 
compared to the current SM-3 Block IA, the IB will be more producible, 
have an improved two-color seeker for greater on-board discrimination, 
and have improvements to enhance reliability of the SM-3 Block IB's 
divert and attitude control system. These improvements also provide an 
enhanced capability to simultaneously engage larger sized raids of 
threat missiles.
    We are requesting $992.4 million in fiscal year 2013 for sea-based 
Aegis BMD to continue development and testing of the SM-3 Block IB, 
continue outfitting of ships with the BMD 4.0.1 system as well as 
spiral upgrades to Aegis 5.0 to support the operation of the SM-3 Block 
IB and IIA interceptors and associated flight tests. We are requesting 
$389.6 million in fiscal year 2013 for the procurement of 29 SM-3 Block 
IB interceptors and $12.2 million to operate and maintain already 
deployed SM-3 Block IA interceptors. In fiscal year 2013, we are also 
requesting $276.3 million to develop and build the Aegis Ashore Test 
Facility at the Pacific Missile Range Facility in Hawaii and $157.9 
million to construct the first Aegis Ashore Missile Defense System 
battery in Romania by fiscal year 2015. We request $366.5 million in 
fiscal year 2013 to operate and sustain C2BMC at fielded sites and 
continue C2BMC program spiral development of software and engineering 
to incorporate enhanced C2BMC capability into the battle management 
architecture and promote further interoperability among the BMDS 
elements, incorporate boost phase tracking, and improve system-level 
correlation and tracking. We will also continue communications support 
for the AN/TPY-2 radars and PAA-related C2BMC upgrades.
    In September 2011, we conducted FTM-16 to demonstrate Aegis BMD 
4.0.1 fire control and the first flight test of the SM-3 Block IB 
interceptor. While we did not achieve the intercept of the SRBM 
separating payload, we demonstrated critical system functions, 
including the exceptional performance of the kinetic warhead divert 
system, which allowed the Navy's partial certification of the Aegis BMD 
4.0.1 computer program. In the third quarter of fiscal year 2012, we 
will conduct FTM-16 (Event 2a) to demonstrate the resolution of the 
previous flight test issue and the SM-3 Block IB's Kill Warhead's 
capability. We will also demonstrate the ability of the SM-3 Block IB 
to intercept more complex SRBM targets in FTM-18 and FTM-19 later this 
summer. In the third quarter fiscal year 2013, we will conduct the 
first operational flight test led by the BMDS OTA team involving a 
coordinated and simultaneous engagement involving Aegis BMD, THAAD and 
PAC-3 systems against three targets and two cruise missiles. Our fiscal 
year 2013 testing program continues to demonstrate the SM-3 Block IB 
and Aegis BMD 4.0.1 (FTM-21 and FTM-22), including a salvo engagement 
involving two interceptors against an SRBM.
Enhanced IRBM Defenses in Europe by 2018 (EPAA Phase 3)
    The SM-3 Block IIA interceptor, being co-developed with the 
Japanese government, is on schedule for deployment at Aegis Ashore 
sites in Romania and Poland, and at sea, in 2018 to provide enhanced 
protection for European NATO countries from all ballistic missile 
threats from the Middle East. This year we completed the SM-3 Block IIA 
preliminary design review, and continue shock and vibration testing of 
the SM-3 Block IIA interceptor canister, and development of Aegis BMD 
5.1 fire control system. We also reduced the execution risk of the SM-3 
Block IIA program by increasing the time between flight tests while 
maintaining the original initial capability date of 2018. The fiscal 
year 2013 request for SM-3 Block IIA co-development is $420.6 million.
Expanded Interceptor Battle Space by 2020 (EPAA Phase 4)
    The SM-3 Block IIB will provide a pre-apogee intercept capability 
against IRBMs and an additional layer for a more enhanced Homeland 
defense against potential non-advanced ICBMs launched from today's 
regional threats. This program is in the technology development phase, 
and its 7-year development timeline is consistent with typical 
interceptor development timelines according to Government 
Accountability Office data. Last year we awarded risk reduction 
contracts for missile subsystem components, including advanced 
propulsion, seeker, and lightweight material technologies. We also 
awarded concept design contracts for the SM-3 Block IIB interceptor to 
three aerospace industry teams. In fiscal year 2013, we are requesting 
$224.1 million to develop the Request For Proposal and begin source 
selection for the SM-3 Block IIB Product Development Phase, which we 
propose to begin in early 2014. The SM-3 Block IIB is leveraging 
advanced tracking and discrimination technologies planned for 
deployment during EPAA Phase 4, as well as the entire sensor network, 
with PTSS and C2BMC upgrades to maximize Homeland defense.
                additional missile defense capabilities
    This year, we are procuring 42 THAAD interceptors for Batteries 1 
and 2, 6 launchers, and 2 THAAD Tactical Station Groups. We are 
requesting $316.9 million in RDT&E funding in fiscal year 2013 to 
enhance communications and debris mitigation, which will allow THAAD to 
be more interoperable with PAC-3 and Aegis BMD and connected to the 
BMDS, and $55.7 million for THAAD operations and maintenance. We also 
request $460.7 million to procure 36 THAAD interceptors. THAAD will 
complete delivery of the first fifty interceptors in June 2012, 
demonstrating the capacity of the contractor supply chain and the main 
assembly factory in Troy, AL, to deliver interceptors. The next 
production lots are under contract, with delivery beginning this 
summer. We will maintain a production rate of four THAAD missiles per 
month through June 2012 due to components on hand and enhance the 
supply chain's production capacity to sustain a three missile per month 
production rate beginning in spring 2013. In late fiscal year 2012, we 
will demonstrate THAAD's ability to intercept an MRBM as part of an 
integrated operational test with PAC-3 and Aegis BMD.
    Additional BMDS improvements include expanded coordination of 
missile defense fire control systems and improvements in radar 
discrimination. We are requesting $51.3 million for the Space Tracking 
and Surveillance System (STSS) in fiscal year 2013. We continue to 
operate the two STSS demonstration satellites to conduct cooperative 
tests with other BMDS elements and demonstrate the capability of STSS 
satellites against targets of opportunity. These tests demonstrate the 
ability of a space sensor to provide high precision, real-time tracking 
of missiles and midcourse objects that enable closing the fire control 
loops with BMDS interceptors. In fiscal year 2013, we plan the first 
live intercept of a threat missile by the Aegis Ballistic Missile 
Defense (BMD) system using only STSS data to form the fire control 
solution for the SM-3 IB interceptor. Additionally, lessons learned 
from the two STSS demonstration satellites inform Precision Tracking 
Space System (PTSS) design development decisions.
                      developing new capabilities
    We are requesting $80 million in fiscal year 2013 to continue 
development of fiscally sustainable advanced BMD technologies that can 
be integrated into the BMDS to adapt as threats change. Intercepts 
early in the battle space will provide additional opportunities to kill 
threat missiles, enlarge protection areas, and improve the overall 
performance of the BMDS.
    Last year, we accelerated our test campaign with the Airborne Laser 
Test Bed (ALTB) to collect data on tracking and atmospheric 
compensation, system jitter, and boundary layer effects on propagation 
for future directed energy applications. This year, in accordance with 
the funding reduction enacted by Congress, we grounded the ALTB 
aircraft and are examining the technical feasibility of high efficiency 
directed energy technology for the next decade. In fiscal year 2013, we 
are requesting $46.9 million to pursue Diode Pumped Alkaline-gas Laser 
System and coherent fiber combining laser technologies, which promise 
to provide high efficiency, electrically-driven, compact, and light-
weight high energy lasers for a wide variety of missions of interest to 
MDA and the Department of Defense and support concept development for 
the next generation of airborne missile defense directed energy 
systems.
    We request $58.7 million in fiscal year 2013 to continue support 
for research and development of advanced remote sensing technologies, 
demonstrate acquisition, tracking and discrimination of multi-color 
infrared sensors, and investigate techniques to improve the system's 
data fusion capability to further strengthen the Nation's missile 
defense sensor network. We have integrated our international and 
domestic university research programs into the same structure, allowing 
the Agency to capitalize on the creativity and innovation within our 
small business and academic communities to enhance our science and 
technology programs.
    The greatest future enhancement for both homeland and regional 
defense in the next 10 years is the development of the Precision 
Tracking Space System (PTSS) satellites, which will provide fire 
control quality track data of raids of hostile ballistic missiles over 
their entire flight trajectories and greatly expand the forward edge of 
the our interceptors' battle space for persistent coverage of over 70 
percent of the Earth's landmass. The need for persistent, full 
trajectory, tracking of ballistic missiles is one of the warfighter's 
highest development priorities as stated in the 2012 STRATCOM PCL. PTSS 
will enhance the performance of all missile defense interceptors at an 
operational cost significantly less (and with much greater ability to 
track large raid sizes of threat missiles) than forward based AN/TPY-2 
radars, based on MDA's experience with STSS program costs. The emerging 
concept design of the PTSS spacecraft is much simpler than STSS because 
it relies on the mature Air Force Space Based Infra-Red (SBIR) 
satellite system to acquire threat ballistic missiles, leverages PTSS's 
ability to provide precision tracks of the remainder of threat 
missiles' trajectories, and uses only satellite components with high 
technology readiness levels. Due to the intrinsic simplicity and 
component maturity of the PTSS design, the integration of concurrent 
developments is considered to be a low acquisition risk. Key to our 
acquisition strategy is MDA partnering Air Force Space Command and the 
Naval Research Laboratory with Johns Hopkins University Applied Physics 
Laboratory (APL), with participation of six aerospace corporations, to 
develop a fully government owned preliminary design and technical data 
package to enable full competitions by our aerospace industry for the 
production for the first and subsequent PTSS satellite constellations. 
MDA is requesting $297.4 million for PTSS in fiscal year 2013 to 
continue development of preliminary design requirements to create these 
multi-mission satellites (e.g., missile defense, space situation 
awareness, DOD and Intelligence Community support). APL has a 
noteworthy track record, dating back to 1979, for meeting planned 
development cost and schedule projections involving 17 significant 
spacecraft missions. We will complete final design and engineering 
models for the PTSS bus, optical payload, and communications payload in 
fiscal year 2013. PTSS project scope includes delivery of PTSS ground 
segments and launch of the first two PTSS spacecraft in fiscal year 
2017. We are fully cooperating in an Independent Cost Estimate (ICE) of 
the development and 20 year life cycle cost of the PTSS constellation 
by the Office of the Secretary of Defense, Office of Capability 
Assessment and Program Evaluation (CAPE), to achieve a high confidence 
cost estimate of the development and 20 year life of the PTSS 
constellation. Of note, this ICE will provide great insight into the 
validity of the recent National Academy of Science (NAS) Boost Phase 
Intercept study cost estimate for the PTSS constellation that we 
believe is considerably higher than our estimates. Although the NAS 
study was critical of PTSS's ability to discriminate a Re-entry Vehicle 
(RV) from other objects accompanying a missile, the NAS did not benefit 
from an understanding of our sensor discrimination architecture concept 
nor our classified programs developing PTSS's future RV discrimination 
capability. However, the NAS study did benefit from understanding our 
disciplined systems engineering process that scrutinizes capability 
trades to achieve urgent, cost-effective, satisfaction of the 
warfighters BMD needs as documented in STRATCOM's PCL.
                       international cooperation
    As stated in the 2010 BMDR, developing international missile 
defense capacity is a key aspect of our strategy to counter ballistic 
missile proliferation. A significant accomplishment of international 
cooperation in 2011 was the signing of the first foreign military sale 
case for the THAAD system to the United Arab Emirates, valued at nearly 
$3.5 billion. In Europe, we successfully completed interoperability 
testing of our C2BMC system with the Active Layer Theater Ballistic 
Missile Defense (ALTBMD) Interim Capability, demonstrating U.S. and 
NATO's ability to share situational awareness of missile defense 
execution and status and planning data. NATO plans to invest more than 
600M Euros for the ALTBMD capability. Moreover, we are working with our 
NATO allies on developing requirements for territorial NATO missile 
defense. We continue to pursue potential missile defense contributions 
of NATO countries such as the Netherlands' announcement that they are 
upgrading their maritime radars with missile defense surveillance and 
tracking capability. In East Asia, we are supporting the BMDR-based 
objective in leading expanded international efforts for missile defense 
through bilateral projects and efforts with Japan, the Republic of 
Korea, and Australia. In the Middle East, we continue to work with 
long-term partners, such as Israel, and are pursuing strengthened 
cooperation with various Gulf Cooperation Council countries that have 
expressed interest in missile defense. MDA is currently engaged in 
missile defense projects, studies and analyses with over 20 countries, 
including Australia, the Czech Republic, Denmark, France, Germany, 
Israel, Japan, Poland, Romania, Saudi Arabia, the United Arab Emirates, 
the United Kingdom, and NATO.
    MDA continues its close partnership with Japan on the SM-3 IIA 
interceptor (Japan is leading the development efforts on the SM-3 Block 
IIA second and third stage rocket motors and the nosecone), studying 
future missile defense architectures for defense of Japan, and 
supporting that nation's SM-3 Block IA flight test program, to include 
the successful intercept flight test in October 2010 involving a 
Japanese SM-3 Block IA. This test completed the first foreign military 
sale of Aegis BMD to a key maritime partner. Japan now has four Aegis 
destroyers equipped with Aegis BMD systems and a complement of SM-3 
Block IA interceptors.
    We also continue collaboration with Israel on the development and 
employment of several missile defense capabilities that are 
interoperable with the U.S. BMDS. Last year, at a U.S. test range off 
the coast of California, the Arrow Weapon System successfully 
intercepted a target representative of potential ballistic missile 
threats facing Israel today. This year, we plan to conduct several 
first time demonstrations of significant David's Sling, Arrow-2 block 
4, and Arrow-3 system capabilities. We are requesting $99.8 million for 
Israeli Cooperative Programs (including Arrow System Improvement and 
the David's Sling Weapon System) in fiscal year 2013 to continue our 
cooperative development of Israeli and U.S. missile defense technology 
and capability. MDA will conduct a David's Sling flight test to 
demonstrate end game and midcourse algorithms and initiate David's 
Sling and Arrow-3 Low Rate Initial Production.
                               conclusion
    Our fiscal year 2013 budget funds the continued development and 
deployment of SRBM, MRBM, IRBM, and ICBM defenses while meeting the 
warfighters' near-term and future missile defense development 
priorities. We are dedicated to returning to successful GMD flight 
testing as soon as possible as well as developing an additional layer 
of Homeland defense with the SM-3 IIB to ensure we have a robust and 
responsive ICBM defense for our Nation, during this decade and for many 
decades in the future. Additionally, we are committed to develop a 
persistent, space based, PTSS constellation to ensure always available, 
early tracking of large size raids of missiles to enable cost-effective 
homeland and regional missile defense. We are also dedicated to 
creating an international and enhanced network of integrated BMD 
capabilities that is flexible, survivable, affordable, and tolerant of 
uncertainties of estimates of both nation-state and extremist ballistic 
missile threats.
    Thank you, Mr. Chairman. I look forward to answering the 
committee's questions.

STATEMENT OF LTG RICHARD P. FORMICA, USA, COMMANDER, U.S. ARMY 
    SPACE AND MISSILE DEFENSE COMMAND/ARMY FORCES STRATEGIC 
COMMAND, AND COMMANDER, JOINT FUNCTIONAL COMPONENT COMMAND FOR 
                   INTEGRATED MISSILE DEFENSE

    [The oral and prepared statements of General Formica 
follow:]
             Oral Statement by LTG Richard P. Formica, USA
    Mr. Chairman, Ranking Member Sessions, and distinguished members of 
the subcommittee, thank you for your ongoing support of our soldiers, 
civilians, and families. I am honored to testify again before this 
panel. This subcommittee is a strong supporter of the Army, the 
Department of Defense, and the missile defense community. As the 
Commander of the U.S. Army's Space and Missile Defense Command (USAMDC) 
and Army Forces Strategic Command, the Army's specified proponent for 
missile defense, and as the Commander of the U.S. Strategic Command's 
(STRATCOM) Joint Functional Component Command for Integrated Missile 
Defense (JFCC IMD), we value your continued support.
    My intent today is to briefly highlight our missile defense force 
provider role for both the Army and Global Combatant Commanders and our 
JFCC IMD role as an operational integrator of joint missile defense for 
STRATCOM.
                     usasmdc/arstrat force provider
    USASMDC/ARSTRAT, a force provider for missile defense capabilities, 
has a vital role in missile defense as JFCC IMD, STRATCOM, and U.S. 
Northern Command are able to leverage the capabilities of USASMDC/
ARSTAT.
    To accomplish our assigned mission, we focus on three core tasks 
within the missile defense arena:

         To provide trained and ready missile defense forces 
        and capabilities to the combatant commanders--our operations 
        function, capabilities that we provide today.
         To build future missile defense forces-our capability 
        development function, the capabilities we will provide 
        tomorrow.
         To research, test, and integrate missile defense 
        related technologiesour materiel development function, those 
        capabilities we will provide the day-atter-tomorrow.
    jfcc imd--synchronizing md operational level planning & support
    JFCC IMD serves an integrating role for missile defense across 
geographic regions as we operationalize new capabilities, evolve 
command relationships, and reinforce our missile defense partnerships 
with allies. Our missile defense capability continues to strengthen as 
warfighters gain increased competence with and confidence in the 
Ballistic Missile Defense System (BMDS). Continued progress has been 
made to evolve the global missile defense capabilities, strengthening 
the defense of the homeland, and to advance our capability to defend 
our forces, allies, and friends abroad.
                               conclusion
    Mr. Chairman, as a member of the joint missile defense community, 
the Army will continue to pursue operational, capability, and materiel 
enhancements to the Nation's BMDS. Our trained and ready soldiers 
operating the Ground-based Missile Defense elements in Colorado, 
Alaska, and California remain on point to defend the homeland against a 
limited intercontinental ballistic missile attack. As a force provider 
to the global combatant commanders, our soldiers ensure essential 
regional sensor capabilities and ballistic missile early warning. 
STRATCOM, through the JFCC IMD, will continue to integrate BMDS 
capabilities to counter global asymmetric threats and protect our 
Nation, deployed forces, friends, and allies.
    I appreciate having the opportunity to speak on these important 
matters and look forward to addressing any questions you may have. 
Secure the High Ground and Army Strong!
                                 ______
                                 
           Prepared Statement by LTG Richard P. Formica, USA
    Mr. Chairman, Ranking Member Sessions, and distinguished members of 
the subcommittee, thank you for your ongoing support of our soldiers, 
civilians, and families. Following my previous appearances on the 
importance of space and space-based capabilities to the Army, I am 
honored to testify before this subcommittee as the Joint and Service 
advocate for effective missile defense capabilities. This subcommittee 
is a strong supporter of the Army, the Department of Defense (DOD), and 
the missile defense community. Your support is important as we continue 
to enhance missile defense capabilities and development of future 
capabilities for the Nation and our global partners.
    In my present assignment, I have three distinct responsibilities in 
support of our Warfighters. First, as the commander of the U.S. Army 
Space and Missile Defense Command (USASMDC), I have Title 10 
responsibilities to train, maintain, and equip space and missile 
defense forces for the Army. Second, I am the Army Service Component 
Commander (ASCC) to the U.S. Strategic Command (STRATCOM) as the 
Commander of the Army Forces Strategic Command (ARSTRAT). I am 
responsible for planning, integrating, and coordinating Army forces and 
capabilities in support of STRATCOM missions. Third, I serve as the 
Commander of STRATCOM's Joint Functional Component Command for 
Integrated Missile Defense (JFCC IMD), supporting the Joint Force to 
synchronize operational-level planning and global missile defense 
operations support. I am honored to testify with these distinguished 
witnesses--all firm advocates in support of a strong missile defense 
capability for our Nation, forward deployed forces, friends, and 
allies.
    During my appearance before you today, my purpose is threefold. The 
first is to highlight USASMDC/ARSTRAT's responsibilities as a force 
provider of missile defense capabilities for the Army and the Global 
Combatant Commanders (GCCs). I will also underscore our force 
modernization proponent as well as our research and development roles 
for the Army. The second is to outline JFCC IMD's role as an 
operational integrator of joint missile defense for STRATCOM. Finally, 
I will provide a summary of some of the Army's missile defense programs 
of record that contribute to the Nation's ability to defend against 
ballistic missiles, both today and tomorrow.
  usasmdc/arstrat--accomplishing our three core missile defense tasks
    USASMDC/ARSTRAT, a force provider for missile defense capabilities, 
is one command that is split-based with dispersed locations around the 
globe, manned by multi-component soldiers, civilians, and contractors. 
I am proud of the capabilities they deliver to the warfighter. As our 
command name implies, USASMDC/ARSTRAT has a vital role in missile 
defense; JFCC IMD, STRATCOM, and U.S. Northern Command (NORTHCOM) are 
able to leverage the capabilities of USASMDC/ARSTAT. USASMDC/ARSTRAT's 
Title 10 responsibilities include operational as well as planning, 
integration, control, and coordination of Army forces and capabilities 
in support of STRATCOM's missile defense mission. USASMDC/ARSTRAT also 
serves as the Army's operational integrator for missile defense, the 
Army's missile defense force modernization proponent, and conducts 
missile defense related research and development in support of Army 
Title 10 responsibilities.
    To accomplish our assigned mission, we focus on three core tasks 
within the missile defense arena:

         To provide trained and ready missile defense forces 
        and capabilities to the combatant commanders--our operations 
        function that addresses today's requirements.
         To build future missile defense forces--our capability 
        development function that is responsible for meeting tomorrow's 
        requirements.
         To research, test, and integrate missile defense 
        related technologies--our materiel development function that 
        aims to advance the Army's and warfighter's missile defense 
        capabilities the day-after-tomorrow.

    Our first core task is to provide trained and ready missile defense 
forces and capabilities to the GCCs and the warfighter--our operations 
function that addresses today's requirements. For missile defense, 
USASMDC/ARSTRAT soldiers, serving on the homeland and in forward 
deployed locations, operate the Ground-Based Midcourse Defense (GMD) 
consoles and the Army Navy/Transportable Radar Surveillance Forward-
Based Mode (AN/TPY-2 FBM) radars. A summary of the critical missile 
defense capabilities provided by our missile defense professionals is 
highlighted below.
Support to Global Ballistic Missile Defense (BMD)
    Soldiers from the 100th GMD Brigade, headquartered at Colorado 
Springs, CO, and the 49th GMD Battalion, headquartered at Fort Greely, 
AK, stand ready, 24/7/365, to defend our Nation and its territories 
from a limited intercontinental ballistic missile attack. Under the 
operational control of NORTHCOM, Active component and Army National 
Guard soldiers operate the GMD Fire Control Systems located at the 
Missile Defense Element in Colorado, the Fire Direction Center in 
Alaska, and the GMD Command Launch Element at Vandenberg Air Force 
Base, CA. These soldiers, in conjunction with JFCC IMD and NORTHCOM, 
also oversee the maintenance of GMD interceptors and ground system 
components. At Fort Greely, soldiers that serve as military police are 
assigned to the 49th GMD Battalion to secure the interceptors and 
communications capabilities at the Missile Defense Complex from 
physical threats.
Support to Regional Capabilities
    The 100th GMD Brigade is also a force provider to other GCCs for 
the AN/TPY-2 FBM radar detachments at isolated locations and provides 
subject matter expertise on training and certification of the radar's 
operations.
GMD System Test and Development
    Soldiers from the 100th GMD Brigade actively participate in GMD 
test activities and routinely work with Missile Defense Agency (MDA) 
developers on future improvements to the GMD system.
Ballistic Missile Early Warning
    Critical to the Joint Force Commander's theater force protection, 
USASMDC/ARSTRAT provides ballistic missile early warning within the 
various theaters. The 1st Space Brigade's Joint Tactical Ground Station 
(JTAGS) Detachments, under the operational control of STRATCOM's Joint 
Functional Component Command for Space, but operated by USASMDC/ARSTRAT 
space-professional soldiers, monitor enemy missile launch activity and 
other infrared events. They provide this essential information to 
members of the air and missile defense and operational communities. Our 
JTAGS Detachments are forward-stationed across critical regions, 
providing 24/7/365, dedicated, assured missile warning to STRATCOM in 
support of deployed forces.
    Our second core task is to build future missile defense forces--our 
capability development function. These are the missile defense 
capabilities we will provide tomorrow. The Army uses established and 
emerging processes to document its missile defense needs and pursue 
Army and Joint validation of its requirements. As a recognized Army 
Center for Analysis, USASMDC/ARSTRAT conducts studies to determine how 
best to meet the Army's missile defense assigned responsibilities. With 
this information, we develop the Doctrine, Organization, Training, 
Materiel, Leadership and Education, Personnel, and Facilities (DOTMLPF) 
domains to mitigate threats and vulnerabilities for the MDA developed 
GMD and AN/TPY-2 FBM missile defense systems. This disciplined approach 
helps ensure limited resources are applied where warfighter operational 
utility can be most effectively served.
    In our third core task, USASDMC/ARSTRAT provides critical 
technologies to address future needs that will enhance warfighter 
effectiveness--our materiel development function. These are the 
capabilities we will provide for the day-after-tomorrow. In USASMDC/
ARSTRAT, our technology development function is primarily focused on 
space and high altitude. While MDA is the principal materiel developer 
for missile defense, we do have a number of ongoing missile defense 
related materiel development efforts. A brief summary of two of these 
research and development efforts as well as an overview of an essential 
Army testing range follows.
High Energy Laser Mobile Demonstrator
    As we have learned often during the Afghanistan and Iraq wars, 
insurgents posed serious dangers to U.S. forward operating bases by 
employing quick-attack, low-trajectory, rockets, artillery, and mortars 
(RAM) strikes. The technology objective of the High Energy Laser Mobile 
Demonstrator (HEL MD) is to demonstrate a solid state laser weapon 
system that will serve as a defensive complementary resource to kinetic 
energy capabilities in countering RAM projectiles. When completed and 
if successful, the HEL MD will consist of a ruggedized and supportable 
high energy laser and subsystems installed on a tactical military 
vehicle that greatly enhance the safety of deployed forces.
Economical Target-1
    Replicating an enemy missile threat is expensive. The Economical 
Target-1 (ET-1) is a research and development effort to supplement 
present flight test inventories and to provide a cost effective 
alternative. The ET-1, which recently successfully completed its 
initial flight test objectives, uses existing technology and hardware 
to develop a new missile defense target configuration that permits 
enhanced kinematic capabilities and signature tailoring.
Missile Defense Testing
    In addition, USASMDC/ARSTRAT operates the Reagan Test Site at 
Kwajalein Atoll. Located in the Marshall Islands, the U.S. Army 
Kwajalein Atoll/Reagan Test Site is critical to the testing of missile 
defense capabilities, testing of the U.S. Air Force's strategic 
ballistic missiles assets, and other testing requirements. In addition 
to its testing mission, we conduct continuous operational space 
surveillance and tracking at the Reagan Test Site.
  joint functional component command for integrated missile defense--
  synchronizing missile defense operational level planning and support
    JFCC IMD, STRATCOM's missile defense integrating element, has been 
operational for 7 years. Like the other JFCCs, JFCC IMD was formed to 
operationalize STRATCOM missions and allow the headquarters to focus on 
strategic-level integration and advocacy. Headquartered at Schriever 
Air Force Base in Colorado Springs, CO, the JFCC IMD is manned by 
extremely capable Army, Navy, Air Force, Marine Corps, and civilian 
personnel.
    STRATCOM has been assigned seven Unified Command Plan (UCP) 
responsibilities for missile defense. As the operational and functional 
component command of STRATCOM, JFCC IMD has derived four key mission 
tasks from the STRATCOM UCP responsibilities:

         Synchronize operational level ballistic missile 
        defense (BMD) planning across the Areas of Responsibility 
        (AORs).
         Optimize the deployed force as the BMD Joint 
        Functional Manager.
         Plan and coordinate developmental and operational 
        activities by conducting BMD asset management.
         Provide alternate missile defense execution support in 
        times of crisis.

    To accomplish each of these four tasks, we maintain close 
collaborative relationships with the GCCs, the MDA, the Services, the 
Office of the Secretary of Defense (OSD), the Joint Staff, our 
coalition allies, and our industry partners. Through collaborative 
processes, we continually add to our deployed capability while gaining 
operational experience and confidence in our collective ability to 
defend our Nation, deployed forces, and our friends and allies. 
Following, I will highlight some of our collaborative efforts to 
enhance missile defense planning and capabilities for both the homeland 
and regional architectures.
Expansion and Integration of a Missile Defense Architecture
    While Homeland defense remains the missile defense priority, the 
Nation is expanding regional capabilities to deployed forces, friends 
and allies. The phased adaptive approach (PAA) is meant to address the 
unique regional threat environments and partnerships that, in turn, 
will serve to further Homeland defense. Given many of the challenges 
associated with implementation of these architectures, JFCC IMD, 
supporting STRATCOM as the synchronizer for missile defense, 
collaborates with the GCCs to assess and address the cross regional 
gaps in the areas of planning, policy, capabilities, and operations to 
enhance our global defense capabilities.
Global BMD Assessment
    While PAAs mature and with Homeland defense at the forefront, JFCC 
IMD collaborates closely with the GCCs to assess the level of risk 
associated with the execution of their operational plans given their 
allocation of BMD capabilities. The overall assessment serves to shape 
recommendations for global force management and advocacy efforts for 
future capability investments. STRATCOM will soon forward the most 
recent theater assessments, consolidated into a global BMD viewpoint, 
to OSD.
    With regards to regional threats, JFCC IMD assessments indicate 
that addressing missile defense threats will remain a challenge. Our 
analysis, reinforced by a recent senior leader tabletop exercise, 
bolsters the fact that GCCs demands for missile defense capabilities 
will always exceed the available BMD inventory. The shortfall 
highlights the need for an Offense/Defense Integration approach to 
missile defense. We must be able to address some of the ballistic 
missile threats before they are in the air. In the short term, we will 
address this mismatch through a comprehensive force management process. 
Over the longer term, we plan to continue to assess the evolving threat 
and look at procurement pathways to meet surging demand while 
emphasizing deterrence alternatives, to include diplomatic, 
information, and economic strategies.
Multi-Regional BMD Asset Management
    While maintaining a holistic, multi-regional perspective but with 
priority on defense of the homeland, JFCC IMD manages the availability 
of missile defense assets to balance operational readiness conditions, 
scheduled and unscheduled maintenance activities, and MDA's test 
requirements. This important process allows us to assess, at all times, 
our readiness to defend against a ballistic missile attack.
Training, Exercises, and War Games
    The PAAs also focus on the expansion of international efforts to 
integrate allies into our regional missile defense architectures. We 
leverage training, exercises, and war games to increase dialogue and 
partnership with our allies. Just last week, we concluded Nimble Titan 
12, a global BMD war game involving 14 participating nations and the 
North Atlantic Treaty Organization. It enabled us to collectively 
examine issues such as command and control, consequence management, and 
rules of engagement. Efforts such as Nimble Titan allow us to explore 
opportunities and continue to develop those cooperative relationships 
that will be critical to developing our combined architectures. 
Conclusions derived from training, exercises, and war games will 
continue to shape our recommendations on asset allocation, resources, 
and operational planning through the existing DOD and missile defense 
community management structures.
Warfighter Acceptance and Integrated Master Test Plan
    As the missile defense architectures mature, we must ensure a 
credible, comprehensive assessment of new abilities to inform 
warfighter decisions for capability acceptance. The MDA, in 
coordination with the Office of the Director, Operational Test and 
Evaluation, executes a robust, operational Integrated Master Test Plan. 
A rigorous test program builds the confidence of stakeholders and 
bolsters deterrence. As part of the Warfighters' Operational Readiness 
and Acceptance process, JFCC IMD works closely with MDA and the GCCs to 
ensure our warfighters take full advantage of these tests to better 
understand the capabilities of the system, to rapidly integrate new 
capabilities into the architecture, and to provide improvement 
recommendations back to the developer.
    In summary, JFCC IMD serves an integrating role for missile defense 
across multiple regions as we operationalize new capabilities, evolve 
command relationships, and reinforce our missile defense partnerships 
with allies. Our missile defense capability continues to strengthen as 
warfighters gain increased competence and confidence in the BMDS. While 
work remains to be done, significant progress has been made to evolve 
the global missile defense capabilities, thereby strengthening the 
defense of the homeland, and to advance our partnership with our allies 
in this important endeavor.
  army contributions to the nation's ballistic missile defense system
    In addition to the MDA's materiel development BMD systems and 
capabilities, the Army continues to develop and field systems that are 
integral contributors to our Nation's BMDS. A summary of the Army's 
major missile defense systems, aligned within the assistant Secretary 
of the Army for Acquisition, Logistics, and Technology organizational 
structure, follows.
    Army Integrated Air and Missile Defense (AIAMD) Program: Within the 
air and missile defense arena, AIAMD is the Army's highest priority 
developmental effort. This initiative will provide a common network-
centric system that integrates sensors, weapons, and command and 
control technologies. The fielded program will provide an enhanced 
capability for unparalleled situational awareness, an ability to tailor 
the force to optimize battle space protection, and a smaller logistics 
footprint. The initial operational capability for the AIAMD 
architecture is scheduled for fielding in 2016.
Medium Extended Air Defense System
    As Congress is aware, based on previous and projected cost and 
schedule growth, the DOD decided to complete only the design and 
development phase of the Medium Extended Air Defense System (MEADS) 
program. The fiscal year 2013 budget request is the last in which the 
Army will seek MEADS funding. The Army's intent is to harvest 
technology from past program investments. Based on enactment of the 
fiscal year 2012 MEADS request, execution is underway to complete 
prototypes, demonstrate and document capabilities, and complete limited 
system integration.
Patriot/Patriot Advanced Capability-3
    Patriot/Patriot Advanced Capability-3 (PAC-3) is the Army's primary 
weapon system against air, cruise, and tactical ballistic missile 
threats. With the DOD decision on the MEADS program, the Army is 
investing in improvements to Patriot system reliability and driving 
down operational and sustainment costs. This year, we will complete the 
effort to ``Grow the Army'' to field 15 Patriot Battalions and intend 
to continue to reduce system life cycle costs while supporting ongoing 
operational requirements. The Army is integrating Patriot and other air 
defense assets into the AIAMD architecture. PAC-3 interceptors continue 
to expand the battle space allowing operational flexibility to our 
Army, GCCs, and international partners. The next generation PAC-3 
missile, the Missile Segment Enhancement, is on track for a 2015 
delivery to the force.
Terminal High Attitude Area Defense System
    Developed by the MDA, the Terminal High Attitude Area Defense 
System (THAAD) is a long-range, land-based, theater defense weapon 
designed to intercept threat missiles during late mid-course or final 
stage flight. THAAD capability for our GCCs is on the near-term horizon 
as the MDA-designed system transfers capability to the Army. Just last 
month, THAAD Batteries 1 and 2 were granted conditional material 
release. Each of the batteries, consisting of 95 soldiers, an AN/TPY-2 
radar, a fire control and communications element, a battery support 
center, and an interim contractor support element, has completed 
equipment and unit collective training. The two batteries currently 
have three THAAD launching systems each but will soon have their full 
complement of six systems. Equipment fielding is also underway for 
THAAD Battery 3 and production has begun on Battery 4 equipment. The 
addition of THAAD capabilities to the Army's air and missile defense 
portfolio brings an unprecedented level of protection against missile 
attacks to deployed U.S. forces, friends, and allies.
                               conclusion
    Mr. Chairman, as a member of the Joint missile defense community, 
the Army will continue to pursue operational, capability, and materiel 
enhancements to the Nation's BMDS. As a Service, we have lead 
responsibility for GMD, AN/TPY-2 FBM, Patriot, and THAAD. Our trained 
and ready soldiers operating the GMD elements in Colorado, Alaska, and 
California remain on point to defend the homeland against a limited 
intercontinental ballistic missile attack. As a force provider to the 
GCCs, our soldiers ensure essential regional sensor capabilities and 
ballistic missile early warning. STRATCOM, through the JFCC IMD, will 
continue to integrate BMDS capabilities to counter global asymmetric 
threats and protect our Nation, deployed forces, friends, and allies. 
The fiscal year 2013 budget proposal supports the modernization and 
improvements of the Army's missile defense systems and forces to 
support the Nation's global BMDS.
    I appreciate having the opportunity to speak on these important 
matters and look forward to addressing any questions you may have. 
Secure the High Ground and Army Strong!

    STATEMENT OF HON. J. MICHAEL GILMORE, Ph.D., DIRECTOR, 
     OPERATIONAL TEST AND EVALUATION, DEPARTMENT OF DEFENSE

    [The prepared statement of Dr. Gilmore follows:]
              Prepared Statement by Dr. J. Michael Gilmore
    Chairman Nelson, Senator Sessions, distinguished members of the 
subcommittee, thank you for the opportunity to discuss missile defense 
test planning, processes, and programs, including my assessment of the 
Ballistic Missile Defense System (BMDS) and the Integrated Master Test 
Plan (IMTP). I will focus my remarks in four areas:

         First, my assessment of the Missile Defense Agency (MDA) 
        flight and ground test program during the past year, the 
        details of which are in my annual report submitted to you on 
        February 13th;
         Second, the major events this last fiscal year that influenced 
        the most recent update to the IMTP, version 12.1;
         Third, my assessments of the Terminal High Altitude Area 
        Defense (THAAD), the AN/TPY-2 Radar, and the Phased Adaptive 
        Approach for the defense of Europe; and
         Finally, I will provide my assessment of the current IMTP.

            fiscal year 2011 flight and ground test program
    The MDA conducted four intercept flight tests this past year: two 
for Aegis Ballistic Missile Defense (BMD), one for Ground-based 
Midcourse Defense (GMD), and one for THAAD. The U.S. Army conducted 
four Patriot intercept flight tests, one for the PAC-3 Missile Segment 
Enhancement interceptor, and three supporting Post Deployment Build 7. 
The MDA conducted 11 ground tests and exercises, with the most 
significant ground test, the Ground Test Distributed-04 (GTD-04) 
series, occurring late in the calendar year supporting the 
implementation of the European Phased Adaptive Approach (EPAA) Phase 1 
capability on December 31, 2011. These flight and ground tests were 
included in the Director of Operational Test and Evaluation (DOT&E)-
approved IMTP.
    During this period, Aegis BMD 3.6.1 and THAAD demonstrated progress 
toward intermediate and short-range threat class capability, 
respectively. Aegis BMD successfully completed Flight Test Standard 
Missile-15 (FTM-15) and THAAD successfully completed Flight Test THAAD-
12 (FTT-12). However, in its first flight test of the Standard Missile-
3 (SM-3) Block IB missile, the MDA failed to achieve a successful 
intercept during FTM-16 Event 2, although the MDA was successful in 
demonstrating many other 4.0.1 Aegis Weapon System capabilities. The 
cause of the FTM-16 failure is under investigation.
    In April 2011, Aegis BMD completed FTM-15, the first intercept of 
an intermediate-range ballistic missile. In this test, an SM-3 Block IA 
interceptor was launched from an Aegis BMD 3.6.1 destroyer, set up with 
remote engagements authorized. The ship used up-range track data from 
an AN/TPY-2 radar in forward-based mode as well as data from its 
organic Aegis radar to prosecute the engagement and intercept the 
target.
    In October 2011, THAAD completed an Initial Operational Test and 
Evaluation (IOT&E) (FTT-12) in which the system intercepted two 
incoming threat missiles nearly simultaneously. In February 2012, DOT&E 
published a detailed report supporting a decision to proceed with 
material release of the system to the Army for operational use.
    GMD suffered a second consecutive flight test failure flying the 
Capability Enhancement II Exo-atmospheric Kill Vehicle, and did not 
demonstrate any progress toward intermediate-range or Intercontinental 
Ballistic Missile (ICBM) threat class capability. A Failure Review 
Board has identified the root cause of the failure of the kill vehicle 
to intercept and the MDA has developed and is implementing corrective 
actions on the associated kill vehicle components to correct the 
problems that caused the failure. It will first test these fixes on a 
non-intercept flight test this spring followed several months later 
with a repeat of the previously attempted intercept flight test.
    For the first time, the Command, Control, Battle Management, and 
Communications (C2BMC) element demonstrated during a ground test in 
December 2011 the capability to control two operationally-deployed AN/
TPY-2 radars in forward-based mode, using existing operational 
communications architectures, personnel, and tactics, techniques, and 
procedures.
    My assessment, based on the testing, is that the MDA flight and 
ground test program for fiscal year/calendar year 2011 was adequate to 
support the development of the BMDS. The flight test program allowed 
the MDA to collect important data on Empirical Measurement Events and 
Critical Engagement Conditions (such as THAAD's near-simultaneous 
intercept of two short-range targets during FTT-12 and an Aegis BMD 
intercept conducted at high closing velocity during the FTM-15 
intercept of an intermediate-range target, respectively) that support 
model and simulation verification, validation, and accreditation. 
During the reporting period, the MDA continued to incorporate elements 
of operational realism when planning for and conducting both ground and 
flight testing.
    The MDA and the BMDS Operational Test Agency have now collected 
sufficient data to permit a quantitative assessment of Aegis BMD and 
THAAD capability. This allowed me to include estimates of the 
probability of engagement success over the tested battlespace of these 
two weapon systems in my 2011 Annual BMDS Assessment Report.
                     events affecting test planning
    Four events affected the development of version 12.1 of the IMTP, 
approved in March 2012:

    1.  The FTM-16 Event 2 flight test failure,
    2.  Funding changes to the 2013 test baseline and the Future Years 
Defense Program,
    3.  The availability of the targets originally planned for use in 
FTO-01 in the fourth quarter of fiscal year 2012, and
    4.  A Space Tracking and Surveillance System (STSS) tracking 
exercise, demonstrating target detection and stereo tracking, that 
enabled the inclusion of a launch-on-STSS in future flight testing.

    Due to the FTM-16 Event 2 failure, the MDA added FTM-16 Event 2a as 
part of the SM-3 return-to-flight plan. This flight test will also 
support the future SM-3 Block IB production decision and provide data 
to certify the performance of the 4.0.1 Aegis Weapon System.
    The MDA maintained the GMD test sequence in IMTP version 12.1. The 
MDA will conduct their first engagement of an ICBM, with the target 
flying a range of greater than 5,000 kilometers, in fiscal year 2015. 
This will also be the first salvo test of two interceptors fired at a 
single target. The MDA will conduct a multiple simultaneous engagement 
of two interceptors on two targets in fiscal year 2018.
    The MDA slowed the THAAD test cadence to 18-month test centers due 
to budget constraints within the agency. As a result, FTT-11a 
(exoatmospheric engagement of a complex short-range target) is delayed 
by five quarters to the fourth quarter of fiscal year 2014, FTT-15 
(endo-atmospheric engagement of a medium-range target with an Aegis BMD 
cue) by 11 quarters to the second quarter of fiscal year 2017, FTT-16 
(endoatmospheric engagement of a unitary short-range target with high 
re-entry heating effects), and FTT-17 (engagement of a maximum range 
medium-range target) deferred beyond the Future Years Defense Program. 
However, THAAD will nonetheless participate in several previously 
planned integrated and operational BMDS tests to be conducted through 
fiscal year 2015.
    The FTO-01 operational test of layered defenses comprising THAAD, 
Aegis, and Patriot was delayed, primarily due to the unavailability of 
the originally planned targets. Analysis conducted last year also 
raised currently unresolved issues regarding the performance of THAAD 
under the planned conditions of the test. As a result, MDA now plans to 
conduct an integration test using the ballistic and cruise missile 
targets that will be available to provide data needed to resolve the 
identified performance issues, as well as to provide operational 
commanders with information they will use to develop tactics, 
techniques, and procedures for employing layered theater missile 
defenses. The MDA moved FTO-01 from the fourth quarter of fiscal year 
2012 to the third quarter of fiscal year 2013 and, in its place, added 
the walk-up event FTI-01 in the fourth quarter of fiscal year 2012. 
FTI-01 will be conducted as a combined developmental/operational test 
utilizing Aegis BMD, THAAD, and Patriot simulating a layered defense of 
the Central Command Area of Responsibility.
    The MDA added FTM-20 in fiscal year 2014 to demonstrate launch-on-
STSS capability. The STSS-generated track will be forwarded by the 
C2BMC to an Aegis BMD 3.6.1 ship that will engage the target with an 
SM-3 Block 1A interceptor.
         assessments of thaad, the an/tpy-2 radar, and the epaa
    In February, I published a report on the initial operation test and 
evaluation (IOT&E) of THAAD and the AN/TPY-2 radar. I based my 
assessment primarily on FTT-12, the IOT&E conducted at the Pacific 
Missile Range Facility from August to October 2011. However, I used 
significant contributing data from prior flight tests, lethality 
testing, and other testing of mobility, safety, and electromagnetic/
environmental effects conducted from 2006 through 2011. To assess AN/
TPY-2 performance in its Forward-Based Mode (FBM), I also used data 
from FTG-06a, FTM-15, and ground testing associated with the radars 
currently deployed in Israel, Japan, and Turkey.
    THAAD is operationally effective against simple short-range 
ballistic missile threats intercepted in both the endo- and low exo-
atmosphere. Although THAAD has not yet demonstrated its capability 
against medium-range threats, ground testing and analyses indicate it 
has an inherent capability to deal with those threats. The AN/TPY-2 
(FBM) radar is operationally effective at providing track data on 
intermediate-range threats to the C2BMC, the BMDS command and control 
architecture, for use by Aegis BMD or GMD.
    THAAD is operationally suitable, but examination of reliability 
data, ground test results, problems encountered during testing, and 
soldier feedback indicate that the THAAD system has a number of 
limitations that the MDA should investigate or correct to increase the 
suitability of the system. Available contractor data, combined with 
THAAD test results, indicate the AN/TPY-2 (FBM) radar is operationally 
suitable.
    In February, I also published my annual BMDS Assessment Report that 
includes an assessment of EPAA Phase 1 capability. I based my 
assessment primarily on FTM-15, an operational test featuring an Aegis 
BMD launch-onremote engagement of an intermediate-range ballistic 
missile using up-range track data provided by an AN/TPY-2 (FBM) radar. 
However, I also used data from previous Aegis BMD 3.6.1 testing and 
ground testing conducted from July to October 2011. I also used 
Technical Assessment-04 that explored EPAA Phase 1 capability by 
simultaneously executing multiple theater engagements with Aegis BMD, 
AN/TPY-2 (FBM), and C2BMC in a digital modeling and simulation 
environment. All of this testing supported an assessment of capability 
over a limited region of the overall EPAA battlespace.
    As currently deployed, Aegis BMD 3.6.1 provides some BMDS 
capabilities against short-, medium-, and intermediate-range ballistic 
missiles targeted at Europe. Aegis BMD 3.6.1 includes midcourse-phase 
engagement capabilities with SM-3 Block IA interceptors and terminal-
phase engagement capabilities with modified SM-2 Block IV interceptors.
    While the MDA has made progress toward achieving and demonstrating 
integrated engagement planning and execution to support the EPAA, such 
capability for use against all potential threat classes during all 
relevant phases of flight has not yet been demonstrated. BMDS battle 
management includes engagement planning, sensor management, track 
forwarding, sensor-weapon system pairing, and BMDS engagement 
direction. C2BMC is the element that is planned to perform global 
battle management while BMD weapon elements retain element-level battle 
management and fire control functionality. In December 2011, the U.S. 
European Command upgraded C2BMC to Spiral 6.4 (S6.4), replacing S6.2, 
as part of the EPAA Phase 1 deployment.
    The capability to launch on remote track data is crucial to the 
defense of Europe as it increases battlespace. In the fully implemented 
EPAA, Aegis BMD will rely upon at least two AN/TPY-2 (FBM) radars to 
provide radar cues and launch-on-remote track data. Aegis BMD executed 
a launch-on-remote engagement of an intermediate range target using AN/
TPY-2 (FBM) tracks forwarded by C2BMC during FTM-15. Several ground 
tests in the GT-04 campaign also exercised launch-on-remote capability 
culminating in GTD-04d Part 3, which used assets that are part of the 
initial EPAA Phase 1 deployment.
    C2BMC software demonstrated track forwarding of single AN/TPY-2 
(FBM) tracks to Tactical Digital Information Link J (Link 16) users in 
multiple ground tests and FTM-15 in fiscal year 2011. C2BMC also 
exercised the forwarding of track data from two AN/TPY-2(FBM) radars in 
two integrated and one distributed ground tests as part of the EPAA 
Phase 1 capability demonstration. However, there has been no 
demonstration of this capability using multiple AN/TPY-2 (FBM) radars 
and Aegis BMD ships in a flight test.
    As the MDA executes the IMTP during the next several years, 
additional test data supporting more comprehensive quantitative 
assessments of the EPAA, as well as other elements of the BMDS will 
become available. However, complete quantitative assessments of EPAA 
capability are still a number of years away because it will take time 
to collect the test data needed to verify, validate, and accredit the 
models and simulations required to perform these assessments.
                     assessment of the current imtp
    The Director of MDA, General O'Reilly, has continued to pursue a 
rigorous IMTP development process that has produced a rigorous and 
well-justified set of tests. My office continues to be involved 
throughout the 6-month review and revision process leading to each 
update of the IMTP. This process has worked well during the preparation 
of the five previous semiannual plans, including the most recent IMTP 
(version 12.1), that I approved jointly with General O'Reilly in March. 
The process has enabled each version of the IMTP to be revised in a 
timely manner consistent with policy changes, flight test results 
(including unsuccessful intercepts) such as those I have mentioned 
previously, or, fact-of-life changes in budgetary resources. The 
current IMTP is a rigorous plan for obtaining the test information 
needed to assess BMDS performance quantitatively.
    However, the IMTP continues to be success-oriented, which is the 
case for most of the Department's test programs. It does not explicitly 
include plans for backup or repeat tests that would be needed in the 
event of flight test mission failures. Therefore, the effects of 
unsuccessful tests, such as the FTG-06a and FTM-16 Event 2 failures, 
need to be mitigated through future updates of the IMTP. Nonetheless, 
the 6-month revision process has allowed MDA to make the necessary 
adjustments and create flexibility when it has been needed.
                               conclusion
    The ability to conduct comprehensive quantitative assessments of 
all BMDS capability across the full battlespace for each of the 
elements is still a number of years away. Nonetheless, BMDS testing has 
now produced sufficient data to enable a quantitative assessment of 
capability for both THAAD and Aegis BMD covering a portion of their 
battlespace. Notwithstanding the reductions made to the overall MDA 
budget as a result of the Budget Control Act, the pace and content of 
GMD testing has been sustained relative to previous IMTPs. In 
particular, the pace of GMD flight testing continues to be consistent 
with the best that has been achieved historically. Fact-of-life 
limitations on flight testing make it impossible for such testing alone 
to provide sufficient data to perform a statistically rigorous 
assessment of the performance of any BMDS element across its full 
battlespace. This is why a key focus of the IMTP has been since its 
inception to collect the data needed to validate the models and 
simulations that will provide the means to assess BMDS operational 
capability across that full battlespace. The rigorous testing 
incorporated in the IMTP will inevitably lead to flight test failures. 
These failures, although often perceived as setbacks, provide 
information that is absolutely critical to assuring that our ballistic 
missile defenses will work under realistic and stressing conditions.

 STATEMENT OF CRISTINA T. CHAPLAIN, DIRECTOR, ACQUISITION AND 
     SOURCING MANAGEMENT, GOVERNMENT ACCOUNTABILITY OFFICE

    [The prepared statement of Ms. Chaplain follows:]
                Prepared Statement by Cristina Chaplain
    Chairman Nelson, Ranking Member Sessions, and members of the 
subcommittee: I am pleased to be here today to discuss the progress 
made by the Department of Defense's (DOD) Missile Defense Agency (MDA). 
In 2002, MDA was charged with developing and fielding the Ballistic 
Missile Defense System (BMDS), expected to be capable of defending the 
United States, deployed troops, friends, and allies against ballistic 
missiles of all ranges in all phases of flight. To enable MDA to field 
and enhance a missile defense system quickly, the Secretary of Defense 
in 2002 delayed entry of the BMDS program into DOD's traditional 
acquisition process until a mature capability was ready to be handed 
over to a military service for production and operation. To meet a 
presidential directive to deliver an initial capability by 2004 and to 
meet a presidential announcement in 2009 to deploy missile defenses to 
Europe, the program concurrently developed and fielded assets and 
continues to utilize this approach. Since its inception, MDA has spent 
more than $80 billion and plans to spend an additional $44 billion 
through 2016 to develop a highly complex system of systems.
    Since 2002, National Defense Authorization Acts have mandated that 
we prepare annual assessments of MDA's ongoing cost, schedule, testing, 
and performance progress.\1\ We recently issued our report covering 
MDA's progress during fiscal year 2011 as well as challenges related to 
MDA's use of highly concurrent acquisition strategies.\2\ My statement 
today will focus on the issues covered in that report as well our June 
2011 report on parts quality issues affecting space and missile defense 
systems.\3\ Our work highlighted a number of causal factors behind the 
parts quality problems being experienced at MDA and space agencies.
---------------------------------------------------------------------------
    \1\ National Defense Authorization Act for Fiscal Year 2002, Pub. 
L. No. 107-107, Sec. 232(g) (2001); Ronald W. Reagan National Defense 
Authorization Act for Fiscal Year 2005, Pub. L. No. 108-375, Sec. 233 
(2004); National Defense Authorization Act for Fiscal Year 2006, Pub. 
L. No. 109-163, Sec. 232; John Warner National Defense Authorization 
Act for Fiscal Year 2007, Pub. L. No. 109-364, Sec. 224 (2006); and 
National Defense Authorization Act for Fiscal Year 2008, Pub. L. No. 
110-181, Sec. 225. See also National Defense Authorization Act for 
Fiscal Year 2012, Pub. L. No. 112-81, Sec. 232 (2011).
    \2\ GAO, Missile Defense: Opportunity Exists to Strengthen 
Acquisitions by Reducing Concurrency, GAO-12-486 (Washington, DC: Apr. 
20, 2012).
    \3\ GAO, Space and Missile Defense Acquisitions: Periodic 
Assessment Needed to Correct Parts Quality Problems in Major Programs, 
GAO-11-404 (Washington, DC: June 24, 2011).
---------------------------------------------------------------------------
    We conducted the work underlying this testimony according to 
generally accepted government auditing standards. Those standards 
require that we plan and perform the audit to obtain sufficient, 
appropriate evidence to provide a reasonable basis for our findings and 
conclusions based on our audit objectives. We believe that the evidence 
obtained provides a reasonable basis for our findings and conclusions 
based on our audit objectives. Additional information on our scope and 
methodology is available in each of the issued reports.
                               background
    MDA's BMDS is being designed to counter ballistic missiles of all 
ranges--short, medium, intermediate, and intercontinental.\4\ Since 
ballistic missiles have different ranges, speeds, sizes, and 
performance characteristics, MDA is developing multiple systems that 
when integrated provide multiple opportunities to destroy ballistic 
missiles before they can reach their targets. The BMDS architecture 
includes space-based and airborne sensors as well as ground- and sea-
based radars; ground- and sea-based interceptor missiles; and a command 
and control, battle management, and communications system to provide 
the warfighter with the necessary communication links to the sensors 
and interceptor missiles.
---------------------------------------------------------------------------
    \4\ Ballistic missiles are classified by range: short-range 
ballistic missiles have a range of less than1,000 kilometers (621 
miles), medium-range ballistic missiles have a range of from 1,000 to 
3,000 kilometers (621-1,864 miles), intermediate-range ballistic 
missiles have a range of from 3,000 to 5,500 kilometers (1,864-3,418 
miles), and intercontinental ballistic missiles have a range of greater 
than 5,500 kilometers (3,418 miles).
---------------------------------------------------------------------------
    Table 1 provides a brief description of 10 BMDS elements and 
supporting efforts currently under development by MDA.

   TABLE 1: DESCRIPTION OF MDA'S BMDS ELEMENTS AND SUPPORTING EFFORTS
------------------------------------------------------------------------
      BMDS Element/Supporting Effort                 Description
------------------------------------------------------------------------
Aegis Ballistic Missile Defense (Aegis      Aegis BMD is a sea-based
 BMD) with Standard Missile-3 (SM-3) Block   missile defense system
 IA and Block IB.                            being developed in
                                             capability-based increments
                                             to defend against ballistic
                                             missiles of all ranges. Key
                                             components include the
                                             shipboard SPY-1 radar, SM-3
                                             missiles, and command and
                                             control systems. It also is
                                             used as a forward-deployed
                                             sensor for surveillance and
                                             tracking of ballistic
                                             missiles. The SM-3 missile
                                             has multiple versions in
                                             development or production.
                                             The first two variants are
                                             referred to as the SM-3
                                             Block IA and SM-3 Block
                                             IB.a
Aegis Ashore..............................  Aegis Ashore is a future
                                             land-based variant of the
                                             ship-based Aegis BMD. It is
                                             expected to track and
                                             intercept ballistic
                                             missiles in their midcourse
                                             phase of flight using SM-3
                                             interceptor variants as
                                             they become available. Key
                                             components include a
                                             vertical launch system and
                                             a reconstitutable enclosure
                                             that houses the SPY-1 radar
                                             and command and control
                                             system known as the
                                             deckhouse. DOD plans to
                                             deploy the first Aegis
                                             Ashore with SM-3 Block IB
                                             in the 2015 time frame as
                                             part of the missile defense
                                             of Europe called the
                                             European Phased Adaptive
                                             Approach (EPAA).
Aegis BMD SM-3 Block IIA..................  The SM-3 Block IIA is the
                                             third SM-3 variant to be
                                             developed for use with the
                                             sea-based and future land-
                                             based Aegis BMD. This
                                             program began in 2006 as a
                                             joint development with
                                             Japan, and it was added to
                                             the EPAA when that approach
                                             was announced in 2009. As
                                             part of EPAA Phase III, the
                                             SM-3 Block IIA is planned
                                             to be fielded with Aegis
                                             Weapons System version 5.1
                                             by the 2018 timeframe.
Aegis BMD SM-3 Block IIB..................  The SM-3 IIB is the fourth
                                             SM-3 variant planned. It is
                                             intended to defend against
                                             medium- and intermediate-
                                             range ballistic missiles
                                             and provide early intercept
                                             capabilities against some
                                             intercontinental ballistic
                                             missiles. The SM-3 Block
                                             IIB program began in June
                                             2010 and is planned to be
                                             fielded by the 2020 time
                                             frame as part of the EPAA
                                             Phase IV. Given its early
                                             stage of development,
                                             program management
                                             officials stated that the
                                             SM-3 Block IIB is not
                                             managed within the Aegis
                                             BMD Program Office and has
                                             not been baselined.
BMDS Sensors..............................  MDA is developing various
                                             sensors for fielding. These
                                             include forward-based
                                             sensors; mobile, sea-based,
                                             space-based, and airborne
                                             sensors; as well as
                                             upgrades to existing early
                                             warning radars. The BMDS
                                             uses these sensors to
                                             identify and continuously
                                             track ballistic missiles in
                                             all phases of flight.
Command, Control, Battle Management, and    C2BMC is the integrating
 Communications (C2BMC).                     element of the BMDS. Its
                                             role is to provide
                                             deliberate planning,
                                             situational awareness,
                                             sensor management, and
                                             battle management for the
                                             integrated BMDS.
Ground-based Midcourse Defense (GMD)......  GMD is a ground-based
                                             missile defense system
                                             designed to destroy
                                             intermediate and
                                             intercontinental ballistic
                                             missiles during the
                                             midcourse phase of their
                                             flight. Its mission is to
                                             protect the U.S. Homeland
                                             against ballistic missile
                                             attacks from North Korea
                                             and the Middle East. GMD
                                             has two Ground-based
                                             Interceptor (GBI) variants--
                                             the Capability Enhancement
                                             I (CE-I) and the Capability
                                             Enhancement II (CE-II). MDA
                                             has emplaced its total
                                             planned inventory of 30
                                             interceptors at two missile
                                             field sites--Fort Greely,
                                             AK, and Vandenberg, CA.
Precision Tracking and Space System (PTSS)  PTSS is being developed as
                                             an operational component of
                                             the BMDS designed to
                                             support intercept of
                                             regional medium- and
                                             intermediate-range
                                             ballistic missile threats
                                             to U.S. Forces and allies
                                             and long-range threats to
                                             the United States. PTSS
                                             will track large missile
                                             raid sizes after booster
                                             burnout, which could enable
                                             earlier intercepts.
Targets and Countermeasures...............  MDA develops and
                                             manufactures highly complex
                                             targets for short, medium,
                                             intermediate, and
                                             eventually intercontinental
                                             ranges used in BMDS flight
                                             tests to present realistic
                                             threat scenarios. The
                                             targets are designed to
                                             encompass the full spectrum
                                             of threat missile ranges
                                             and capabilities.
Terminal High Altitude Area Defense         THAAD is a ground-based
 (THAAD).                                    missile defense system
                                             designed to destroy short-
                                             and medium-range ballistic
                                             missiles during the late-
                                             midcourse and terminal
                                             phases of flight. Its
                                             mission is to defend
                                             deployed U.S. Forces and
                                             friendly foreign population
                                             centers.
------------------------------------------------------------------------
Source: MDA data.
Note: The EPAA is a policy announced by the President in 2009 that
  articulates a schedule for delivering four phases of capability to
  defend Europe and augment current protection of the U.S. Homeland in
  the following timeframes: Phase 1 in 2011, Phase 2 in 2015, Phase 3 in
  2018, and Phase 4 in 2020.
a MDA is currently developing or producing four versions of the SM-3
  interceptor--IA, IB, IIA, and IIB. The SM-3 Block IA and SM-3 Block IB
  are the earlier variants of the missile. The SM-3 Block IIA and SM-3
  Block IIB are planned to provide successively greater range and
  velocity to intercept medium to long-range ballistic missiles.

   mda experienced mixed progress in development and delivery efforts
    MDA experienced mixed results in executing its fiscal year 2011 
development goals and BMDS tests. For the first time in 5 years, we are 
able to report that all of the targets used in fiscal year 2011 test 
events were delivered as planned and performed as expected. In 
addition, the Aegis BMD program's SM-3 Block IA missile was able to 
intercept an intermediate-range target for the first time. Also, the 
THAAD program successfully conducted its first operational flight test 
in October 2011. However, none of the programs we assessed were able to 
fully accomplish their asset delivery and capability goals for the 
year.
    See table 2 for how each of these programs met some of its goals 
during the fiscal year. Our report provides further detail on these 
selected accomplishments.\5\
---------------------------------------------------------------------------
    \5\ GAO-12-486.

         TABLE 2: BMDS FISCAL YEAR 2011 SELECTED ACCOMPLISHMENTS
------------------------------------------------------------------------
                                  Fully Accomplished   Partially or Not
             Element                     Goals        Accomplished Goals
------------------------------------------------------------------------
Aegis BMD SM-3 Block IA.........  An April 2011       Delivered 6 out of
                                   flight test         19 planned
                                   demonstrated        missiles by the
                                   capability          end of fiscal
                                   required for        year 2011;
                                   European Phased     delivery of 12
                                   Adaptive Approach   missiles is on
                                   (EPAA) Phase I.     hold pending the
                                   Deployed first      results of the
                                   ship in support     failure
                                   of EPAA Phase I.    investigation of
                                                       the anomaly that
                                                       occurred during
                                                       an April 2011
                                                       flight test.
                                                       Depending on the
                                                       results,
                                                       delivered
                                                       missiles may have
                                                       to be
                                                       retrofitted.
Aegis BMD SM-3 Block IB.........  Delivered first SM- The SM-3 Block IB
                                   3 Block IB          failed to
                                   developmental       intercept the
                                   interceptor and     target during its
                                   fired it in the     first flight
                                   first flight test   test, resulting
                                   in September 2011.  in a failure
                                                       review board
                                                       investigation of
                                                       the cause of the
                                                       failure. The
                                                       flight test is
                                                       scheduled to be
                                                       reconducted in
                                                       2012, delaying
                                                       the certification
                                                       of the Aegis BMD
                                                       4.0.1 weapon
                                                       system.
Aegis BMD SM-3 Block IIA........  None.               Subsystem
                                                       preliminary
                                                       design review
                                                       failures led to a
                                                       program replan
                                                       that adjusted the
                                                       preliminary
                                                       design review
                                                       date to fiscal
                                                       year 2012 and
                                                       included new
                                                       subsystem reviews
                                                       for the failed
                                                       components. The
                                                       new subsystem
                                                       reviews were
                                                       completed in
                                                       fiscal year 2011
                                                       and early fiscal
                                                       year 2012.
Aegis BMD SM-3 Block IIB........  Awarded three       Demonstration of
                                   concept             low-cost divert
                                   definition and      and attitude
                                   program planning    control system
                                   contracts in        components was
                                   April 2011 and      delayed until the
                                   approved to begin   first quarter of
                                   technology          fiscal year 2012.
                                   development in
                                   July 2011.
Aegis Ashore                      Completed           A new deckhouse
                                   preliminary         fabrication plan
                                   design review in    delayed the award
                                   August 2011.        of the deckhouse
                                                       fabrication
                                                       contract,
                                                       procurement of
                                                       deckhouse
                                                       fabrication
                                                       materials, and
                                                       the start of
                                                       construction.
GMD                               Completed three of  Flight test
                                   the five limited    failure in the
                                   interceptor         first quarter of
                                   upgrades,           fiscal year 2011
                                   partially to        resulted in
                                   resolve component   interceptor
                                   issues identified   production
                                   in developmental    suspension
                                   testing and         pending the
                                   manufacturing.      completion of an
                                                       investigation and
                                                       a successful non-
                                                       intercept flight
                                                       test.
PTSS                              Completed system    Approval to begin
                                   requirements and    technology
                                   system design       development was
                                   reviews in the      delayed to the
                                   second quarter of   fourth quarter of
                                   fiscal year 2011.   fiscal year 2012.
Targets                           Launched all 11     Delivered 11 out
                                   targets as          of 14 targets it
                                   planned.            had planned.
THAAD                             Successfully        Materiel release
                                   conducted first     to Army delayed
                                   operational         to the second
                                   flight test in      quarter of fiscal
                                   October 2011.       year 2012. THAAD
                                   Delivered 11        delayed plans to
                                   missiles.           deliver first
                                                       battery to fiscal
                                                       year 2012 because
                                                       of production
                                                       issues with the
                                                       interceptor.
------------------------------------------------------------------------
Source: GAO analysis of MDA data.
Note: BMDS fiscal year 2011 asset and capability deliveries for Airborne
  Infrared; C2BMC; joint U.S.-Israel BMDS; Sea-based X-band radar; and
  Space Tracking and Surveillance System elements were not reviewed.

    Although some programs completed significant accomplishments during 
the fiscal year, there were also several critical test failures. These 
as well as a test anomaly and delays disrupted MDA's flight test plan 
and the acquisition strategies of several components. Overall, flight 
test failures and an anomaly forced MDA to suspend or slow production 
of three out of four interceptors currently being manufactured.

         The Aegis BMD SM-3 Block IA program conducted a 
        successful intercept in April 2011, but there was an anomaly in 
        a critical component of the interceptor during the test. This 
        component is common with the Block IB missile. Program 
        management officials stated that the SM-3 Block IA deliveries 
        have been suspended while the failure reviews are being 
        conducted.
         The Aegis BMD SM-3 Block IB program failed in its 
        first intercept attempt in September 2011. The Aegis program 
        has had to add an additional flight test and delay multiple 
        other flight tests. Program management officials stated that 
        the SM-3 Block IB production has been slowed while the failure 
        reviews are being conducted.
         The GMD program has been disrupted by two recent test 
        failures. As a result of a failed flight test in January 2010, 
        MDA added a retest designated as Flight Test GMD-06a (FTG-
        06a).\6\ However, this retest also failed in December 2010 
        because of a failure in a key component of the kill vehicle. As 
        a result of these failures, MDA has decided to halt flight 
        testing and restructure its multiyear flight test program, halt 
        production of the interceptors, and redirect resources to 
        return-to-flight activities.
---------------------------------------------------------------------------
    \6\ The failed January 2010 flight test--FTG-06--was planned as the 
first test of GMD's enhanced version of the kill vehicle--the CE-II.

    Production issues forced MDA to slow production of the THAAD 
interceptors, the fourth missile being manufactured.
  highly concurrent acquisition strategies often lead to performance, 
                    cost, and schedule consequences
    To meet the 2002 presidential direction to initially rapidly field 
and update missile defense capabilities as well as a 2009 presidential 
announcement to deploy missile defenses in Europe, MDA has undertaken 
and continues to undertake highly concurrent acquisitions. While this 
approach enabled MDA to rapidly deploy an initial capability in 2005 by 
concurrently developing, manufacturing, and fielding BMDS assets, it 
also led to the initiation of large-scale acquisition efforts before 
critical technologies were fully understood and allowed programs to 
move forward into production without having tests completed to verify 
performance. After delivering its initial capability in 2005, MDA 
continued these high-risk practices that have resulted in problems 
requiring extensive retrofits, redesigns, delays, and cost increases. 
While MDA has incorporated some acquisition best practices in its newer 
programs, its acquisition strategies still include high or elevated 
levels of concurrency that result in increased acquisition risk--
including performance shortfalls, cost growth, and schedule delays--for 
these newer programs.
    Concurrency is broadly defined as overlap between technology 
development and product development or between product development and 
production of a system. This overlap is intended to introduce systems 
rapidly, to fulfill an urgent need, to avoid technology obsolescence, 
and to maintain an efficient industrial development and production 
workforce. However, while some concurrency is understandable, 
committing to product development before requirements are understood 
and technologies mature as well as committing to production and 
fielding before development is complete is a high-risk strategy that 
often results in performance shortfalls, unexpected cost increases, 
schedule delays, and test problems.\7\ At the very least, a highly 
concurrent strategy forces decisionmakers to make key decisions without 
adequate information about the weapon's demonstrated operational 
effectiveness, reliability, logistic supportability, and readiness for 
production. Also, starting production before critical tests have been 
successfully completed has resulted in the purchase of systems that do 
not perform as intended. These premature commitments mean that a 
substantial commitment to production has been made before the results 
of testing are available to decisionmakers. Accordingly, they create 
pressure to avoid production breaks even when problems are discovered 
in testing. These premature purchases have affected the operational 
readiness of our forces and quite often have led to expensive 
modifications.
---------------------------------------------------------------------------
    \7\ GAO, Best Practices: Capturing Design and Manufacturing 
Knowledge Early Improves Acquisition Outcomes, GAO-02-701 (Washington, 
DC: July 15, 2002), and Defense Acquisitions: Production and Fielding 
of Missile Defense Components Continue with Less Testing and Validation 
Than Planned, GAO-09-338 (Washington, DC: Mar. 13, 2009).
---------------------------------------------------------------------------
    In contrast, our work has found that successful programs that 
deliver promised capabilities for the estimated cost and schedule 
follow a systematic and disciplined knowledge-based approach, in which 
high levels of product knowledge are demonstrated at critical points in 
development.\8\ This approach recognizes that development programs 
require an appropriate balance between schedule and risk and, in 
practice, programs can be executed successfully with some level of 
concurrency. For example, it is appropriate to order long-lead 
production material in advance of the production decision, with the 
pre-requisite that developmental testing is substantially accomplished 
and the design confirmed to work as intended. This knowledge-based 
approach is not unduly concurrent. Rather, programs gather knowledge 
that demonstrates that their technologies are mature, designs are 
stable, and production processes are in control before transitioning 
between acquisition phases, which helps programs identify and resolve 
risks early. It is a process in which technology development and 
product development are treated differently and managed separately. 
Technology development must allow room for unexpected results and 
delays. Developing a product culminates in delivery and therefore gives 
great weight to design and production. If a program falls short in 
technology maturity, it is harder to achieve design stability and 
almost impossible to achieve production maturity. It is therefore key 
to separate technology from product development and product development 
from production--and thus avoid concurrency. A knowledge-based approach 
delivers a product on time, within budget, and with the promised 
capabilities.
---------------------------------------------------------------------------
    \8\ GAO, Defense Acquisitions: Assessments of Selected Major Weapon 
Programs, GAO-06-391 (Washington, DC: Mar. 31, 2006).
---------------------------------------------------------------------------
    See figure 1 for depictions of a concurrent schedule and a schedule 
that uses a knowledge-based approach.
      
    
    
      
MDA's Concurrent Acquisition Strategies Allowed It to Deliver Assets 
        Quickly but Also Led to Performance Issues with Cost and 
        Schedule Consequences
    To meet the 2002 presidential direction to initially rapidly field 
and update missile defense capabilities as well as the 2009 
presidential announcement to deploy missile defenses in Europe, MDA has 
undertaken and continues to undertake highly concurrent acquisitions. 
Such practices enabled MDA to quickly ramp up efforts in order to meet 
tight presidential deadlines, but they were high risk and resulted in 
problems that required extensive retrofits, redesigns, delays, and cost 
increases.
    Table 3 illustrates concurrency in past efforts and its associated 
effects. Among earlier MDA programs, concurrency was most pronounced in 
the GMD program, where the agency was pressed to deliver initial 
capabilities within a few years to meet the 2002 presidential 
directive. The consequences here have been significant, in terms of 
production delays and performance shortfalls, and are still affecting 
the agency.

TABLE 3: EXAMPLES OF CONCURRENCY IN MDA PROGRAMS' ACQUISITION STRATEGIES
                         AND ASSOCIATED EFFECTS
------------------------------------------------------------------------
                                      Acquisition
           MDA Program                Concurrency     Associated Effects
------------------------------------------------------------------------
GMD's initial capability          To meet the         CE-I interceptors
 including CE-I interceptors in    presidential        were rapidly
 2004 a.                           directive to        delivered to the
                                   deploy an initial   warfighter
                                   set of missile      requiring an
                                   defense             extensive and
                                   capabilities by     expensive
                                   2004, the program   retrofit and
                                   concurrently        refurbishment
                                   matured             program that is
                                   technology,         still ongoing.
                                   designed the
                                   system, tested
                                   the design, and
                                   produced and
                                   deployed an
                                   initial set of
                                   missile defense
                                   capabilities.
GMD's enhanced interceptor        Prior to fully      CE-II interceptors
 production a.                     completing          were delivered
                                   development and     prematurely to
                                   demonstrating the   the warfighter
                                   capability of the   and will require
                                   CE-I interceptor,   an extensive and
                                   MDA committed in    expensive
                                   2004 to             retrofit. It will
                                   development of an   take several
                                   enhanced version    additional years
                                   of the              to demonstrate
                                   interceptor         full CE-II
                                   called the CE-II.   capabilities.
                                   MDA proceeded to    Production has
                                   concurrently        been halted and
                                   develop,            the flight test
                                   manufacture, and    plan has been
                                   deliver 12 of       altered,
                                   these               increasing the
                                   interceptors The    cost to initially
                                   first and second    confirm the CE-II
                                   flight tests of     capability from
                                   the enhanced        $236 million to
                                   interceptor         about $1 billion.
                                   failed.
Aegis BMD SM-3 Block IB.........  MDA approved        Production has
                                   production of the   been delayed,
                                   SM-3 Block IB       delivery of
                                   missile before      capability has
                                   completing          been delayed, and
                                   developmental       development costs
                                   testing to          have grown. The
                                   confirm that the    program has had
                                   technologies were   to add an
                                   fully mature and    additional flight
                                   the design worked   test and delay
                                   as intended. In     multiple
                                   addition, MDA       additional flight
                                   decided to          tests due to the
                                   manufacture SM-3    failure of the
                                   Block IB missiles   program's first
                                   beyond those        attempted
                                   needed for          intercept in
                                   developmental       September 2011.
                                   testing before      Because of the
                                   some criteria       failure, MDA was
                                   were met,           unable to
                                   including a         validate initial
                                   successful first    SM-3 Block IB
                                   flight test         capability. In
                                   demonstrating       addition, an
                                   that the system     anomaly occurred
                                   functioned as       in an April 2011
                                   intended.           flight test of
                                                       the SM-3 Block IA
                                                       in a booster
                                                       component that is
                                                       common with the
                                                       Block IB missile.
                                                       Block IB
                                                       production is
                                                       being slowed
                                                       while failure
                                                       reviews are being
                                                       conducted.
THAAD.                            The agency awarded  Problems
                                   a contract for      encountered while
                                   the production of   THAAD was
                                   THAAD's first two   concurrently
                                   operational         designing and
                                   batteries before    producing assets
                                   its design was      delayed fielding
                                   stable and          of the first two
                                   developmental       THAAD batteries
                                   testing of all      by more than 2
                                   critical            years and
                                   components was      increased costs
                                   complete.           by $40 million.
------------------------------------------------------------------------
Source: GAO analysis of MDA data.
a High levels of concurrency will continue for the GMD program with
  developmental flight testing extending until at least 2022, well after
  production of the interceptor is scheduled to be completed. MDA is
  accepting the risk that these developmental flight tests may discover
  issues that require costly design changes and retrofit programs to
  resolve.

    In recent years, MDA has taken positive steps to incorporate some 
acquisition best practices, such as increasing competition and 
partnering with laboratories to build prototypes. For example, MDA took 
actions in fiscal year 2011 to reduce acquisition risks and prevent 
future cost growth in its Aegis BMD SM-3 Block IIA program. The agency 
recognized that the program's schedule included elevated acquisition 
risks, so it appropriately added more time to the program by revising 
the schedule to relieve schedule compression between its subsystem and 
system-level design reviews. In addition, it incorporated lessons 
learned from other SM-3 variants into its development to further 
mitigate production unit costs. Moreover, for its PTSS program, MDA has 
simplified the design and requirements.
    However, table 4 shows that the agency's current acquisition 
strategies still include high or elevated levels of concurrency that 
set many of its newer programs up for increased acquisition risk, 
including performance shortfalls, cost growth, and schedule delays.

TABLE 4: MDA'S ACQUISITION CONCURRENCY AND ASSOCIATED RISKS IN ITS NEWER
                                PROGRAMS
------------------------------------------------------------------------
                                      Acquisition
           MDA Program                Concurrency            Risks
------------------------------------------------------------------------
Aegis BMD SM-3 Block IIB.         Based on a          Without holding
                                   tentative           key system
                                   schedule, the       engineering
                                   program plans to    events
                                   commit to product   culminating in a
                                   development more    preliminary
                                   than a year prior   design review,
                                   to holding a        programs cannot
                                   preliminary         ensure that
                                   design review. By   requirements are
                                   contrast, major     defined and
                                   defense             feasible and that
                                   acquisition         the proposed
                                   programs outside    design can meet
                                   MDA are generally   those
                                   required to         requirements
                                   complete this       within cost,
                                   review before       schedule, and
                                   committing to       other system
                                   product             constraints.
                                   development.
Aegis Ashore.                     The program began   There are
                                   product             increased
                                   development for     technical risks
                                   two Aegis Ashore    and increased
                                   systems--one        risk of cost
                                   designated for      growth because
                                   testing and the     the agency
                                   other               committed to
                                   operational--and    product
                                   set the             development for
                                   acquisition         the two systems
                                   baseline before     with less
                                   completing the      technical
                                   preliminary         knowledge than
                                   design review.      recommended by
                                   High levels of      acquisition best
                                   concurrency can     practices and
                                   be seen in its      without ensuring
                                   construction and    that requirements
                                   procurement plan,   were defined,
                                   and the program     feasible, and
                                   has not aligned     achievable within
                                   its flight          cost and schedule
                                   testing schedule    constraints.
                                   with construction
                                   and component
                                   procurement
                                   decisions.
Precision Tracking and Space      An industry team    This strategy may
 System.                           will develop and    not enable
                                   produce two         decisionmakers to
                                   engineering and     fully benefit
                                   manufacturing       from the
                                   development         knowledge gained
                                   satellites while    through on-orbit
                                   a laboratory-led    testing of the
                                   contractor team     lab-built
                                   is still in the     satellites and
                                   development phase   its design before
                                   of building two     making major
                                   lab development     commitments on
                                   satellites.         the industry-
                                                       built development
                                                       satellites since
                                                       those will be
                                                       under contract
                                                       and under
                                                       construction
                                                       before the on-
                                                       orbit testing can
                                                       take place.
------------------------------------------------------------------------
Source: GAO analysis of MDA data.

    In our April 2012 report, we made two recommendations to strengthen 
MDA's longer-term acquisition prospects.\9\ We recommended that the 
Secretary of Defense direct the Office of Acquisition Technology and 
Logistics to: (1) review all of MDA's acquisitions for concurrency and 
determine whether the proper balance has been struck between the 
planned deployment dates and the concurrency risks taken to achieve 
those dates; and (2) review and report to the Secretary of Defense the 
extent to which the directed capability delivery dates announced by the 
President in 2009 are contributing to concurrency in missile defense 
acquisitions and recommend schedule adjustments where significant 
benefits can be obtained by reducing concurrency. DOD concurred with 
both of these recommendations.
---------------------------------------------------------------------------
    \9\ GAO-12-486.
---------------------------------------------------------------------------
    In addition, we recommended specific steps to reduce concurrency in 
several of MDA's programs. DOD agreed with four of the five missile 
defense element-specific recommendations and partially agreed with our 
recommendation to report to the Office of the Secretary of Defense and 
to Congress the root cause of the SM-3 Block IB developmental flight 
test failure, path forward for future development, and the plans to 
bridge production from the SM-3 Block IA to the SM-3 Block IB before 
committing to additional purchases of the SM-3 Block IB. DOD commented 
that MDA will report this information to the Office of the Secretary of 
Defense and to Congress upon completion of the failure review in the 
third quarter of fiscal year 2012. However, DOD makes no reference to 
delaying additional purchases until the recommended actions are 
completed. We maintain our position that MDA should take the 
recommended actions before committing to additional purchases of the 
SM-3 Block IB.
parts quality issues have also had a significant effect on performance, 
                           cost, and schedule
    MDA parts quality issues have seriously impeded the development of 
the BMDS in recent years. For example, during a THAAD flight test in 
fiscal year 2010, the air-launched target failed to initiate after it 
was dropped from the aircraft and fell into the ocean. The test was 
aborted and a subsequent failure review board investigation identified 
as the immediate cause of the failure the rigging of cables to the 
missile in the aircraft and shortcomings in internal processes at the 
contractor as the underlying cause. This failure led to a delay of the 
planned test, restructuring of other planned tests, and hundreds of 
millions of dollars being spent to develop and acquire new medium-range 
air-launched targets. In another widely-reported example, the GMD 
element's first intercept test of its CE-II GBI failed and the ensuing 
investigation determined the root cause of the failure to be a quality 
control event. This failure also caused multiple flight tests to be 
rescheduled, delayed program milestones, and cost hundreds of millions 
of dollars for a retest.
    In view of the cost and importance of space and missile defense 
acquisitions, we were asked to examine parts quality problems affecting 
satellites and missile defense systems across DOD and the National 
Aeronautics and Space Administration (NASA). In June 2011, we reported 
that parts problems discovered after assembly or integration of the 
instrument or spacecraft had more significant consequences as they 
required lengthy failure analysis, disassembly, rework, and 
reassembly--sometimes resulting in a launch delay. For example, the 
Space Tracking and Surveillance System (STSS) program, a space-based 
infrared sensor program with two demonstration satellites that launched 
in September 2009, discovered problems with defective electronic parts 
in the Space-Ground Link Subsystem during system-level testing and 
integration of the satellite. By the time the problem was discovered, 
the manufacturer no longer produced the part and an alternate 
contractor had to be found to manufacture and test replacement parts. 
According to officials, the problem cost about $7 million and was one 
of the factors that contributed to a 17-month launch delay of two 
demonstration satellites and delayed participation in the BMDS testing 
we reported on in March 2009.\10\
---------------------------------------------------------------------------
    \10\ GAO, Defense Acquisitions: Assessments of Selected Weapon 
Programs, GAO-09-326SP (Washington, DC: Mar. 30, 2009).
---------------------------------------------------------------------------
    Our work highlighted a number of causal factors behind the parts 
quality problems being experienced at MDA and space agencies.\11\ While 
we present examples of the parts quality issues we found at MDA below, 
the June 2011 report also describes the parts quality issues we found 
with other space agencies.
---------------------------------------------------------------------------
    \11\ GAO-11-404.

         Poor workmanship. For example, poor soldering 
        workmanship caused a power distribution unit to experience 
        problems during vehicle-level testing on MDA's Targets and 
        Countermeasures program. According to MDA officials, all units 
        of the same design by the same manufacturer had to be X-ray 
        inspected and reworked, involving extensive hardware 
        disassembly. As a corrective action, soldering technicians were 
        provided with training to improve their soldering operations 
        and ability to perform better visual inspections after 
        soldering.
         The use of undocumented and untested manufacturing 
        processes. For example, MDA's Aegis BMD program reported that 
        the brackets used to accommodate communications and power 
        cabling were improperly bonded to SM-3 Block IA rocket motors, 
        potentially leading to mission failure. A failure review board 
        determined that the subcontractor had changed the bonding 
        process to reduce high scrap rates and that the new process was 
        not tested and verified before it was implemented.
         Poor control of manufacturing materials and the 
        failure to prevent contamination. The GMD program reported a 
        problem with defective titanium tubing. The defective tubing 
        was rejected in 2004 and was to be returned to the supplier; 
        however, because of poor control of manufacturing materials, a 
        portion of the material was not returned and was inadvertently 
        used to fabricate manifolds for two complete CE-II GBIs. The 
        vehicles had already been processed and delivered to the prime 
        contractor for integration when the problem was discovered.
         Prime contractor's failure to ensure that its 
        subcontractors and suppliers met program requirements. The GMD 
        program experienced a failure with an electronics part 
        purchased from an unauthorized supplier. According to program 
        officials, the prime contractor required subcontractors to only 
        purchase parts from authorized suppliers; however, the 
        subcontractor failed to execute the requirement and the prime 
        contractor did not verify compliance.

    At the time of our June 2011 report, MDA had instituted policies to 
prevent and detect parts quality problems. The programs reviewed in the 
report--GMD, Aegis BMD, STSS, and Targets and Countermeasures--were 
initiated before these recent policies aimed at preventing and 
detecting parts quality problems took full effect. In addition to new 
policies focused on quality, MDA has developed a supplier road map 
database in an effort to gain greater visibility into the supply chain 
to more effectively manage supply chain risks. In addition, according 
to MDA officials, MDA has recently been auditing parts distributors in 
order to rank them for risk in terms of counterfeit parts.
    MDA also participates in a variety of collaborative initiatives to 
address quality, in particular, parts quality. These range from 
informal groups focused on identifying and sharing news about emerging 
problems as quickly as possible, to partnerships that conduct supplier 
assessments, to formal groups focused on identifying ways industry and 
the government can work together to prevent and mitigate problems.
    Moreover, since our report, MDA has added a new clause in one of 
its GMD contracts to provide contractor accountability for quality. We 
have not yet fully assessed the clause but it may allow the contracting 
officer to make an equitable reduction of performance incentive fee on 
two contract line items for certain types of quality problems. This new 
clause shows some leadership by MDA to hold contractors accountable for 
parts quality. But, we do not yet know what the impact of this clause 
will be on improving MDA's problems with parts quality.
    Our June 2011 report recommended greater coordination between 
government organizations responsible for major space and missile 
defense programs on parts quality issues and periodic reporting to 
Congress. DOD partially concurred with our recommendation for greater 
coordination but responded that it would work with NASA to determine 
the optimal government-wide assessment and reporting implementation to 
include all quality issues, of which parts, materials, and processes 
would be one of the major focus areas. In addition, DOD proposed an 
annual reporting period to ensure planned, deliberate, and consistent 
assessments. We support DOD's willingness to address all quality issues 
and to include parts, materials, and processes as an important focus 
area in an annual report. DOD further stated that it had no objection 
to providing a report to Congress, if Congress wanted one. We believe 
that DOD should proactively provide its proposed annual reports to 
Congress on a routine basis, rather than waiting for any requests from 
Congress, which could be inconsistent from year to year.
    The parts quality issues will require sustained attention from both 
the executive and legislative branches to improve the quality of the 
systems in development, particularly because there are significant 
barriers to addressing quality problems, such as an increase in 
counterfeit electronic parts, a declining government share of the 
overall electronic parts market, and workforce gaps within the 
aerospace sector.
                        concluding observations
    In conclusion, as the MDA completes a decade of its work, it 
continues to make progress in delivering assets, completing intercept 
tests, and addressing some of the quality issues that have plagued it 
in the past. This year, there were significant accomplishments, such as 
the successful operational test for THAAD, but also setbacks, including 
failed tests and their aftermath. Such setbacks reflect inherent risks 
associated with the challenging nature of missile defense development, 
but they are also exacerbated by strategies that adopt high levels of 
concurrency that leave decisionmakers with less knowledge than needed 
to move programs forward. Given that initial capabilities are now in 
place and broader fiscal pressures require sound and more efficient 
management approaches, it is now time for DOD to reassess MDA's 
strategy of accelerating development and production to determine 
whether this approach needs to be rethought for current and future BMDS 
programs.
    Chairman Nelson, Ranking Member Sessions, and members of the 
subcommittee, this concludes my statement. I am happy to answer any 
questions you have.

    Senator Nelson. This hearing is now adjourned.
    [Questions for the record with answers supplied follow:]
               Questions Submitted by Senator Carl Levin
                      defects clause in contracts
    1. Senator Levin. General O'Reilly, several years ago, after a 
string of contractor failures, you and I discussed the need for a 
defects clause in Missile Defense Agency (MDA) contracts to protect 
taxpayers from paying for defective work. I understand that the new 
Ground-based Missile Defense (GMD) Development and Sustainment Contract 
(DSC) contains such a clause. Under the new clause, who would pay for 
defective work--the contractor responsible for the defective work or 
the taxpayers--and will you pursue that as a standard clause for future 
contracts?
    General O'Reilly. Under the new clause, the government may reduce a 
contractor's potential performance incentive fee, and recover 
previously awarded fees, to offset the cost of defective work 
accomplished. At present, this clause is only in the Ground-based 
Interceptor (GBI) contract line item numbers (CLINs).
    The clause provides the government the latitude to reduce the 
performance incentive fee if the following three criteria are 
reasonably determined: (1) a quality escape \1\ occurred; (2) the 
contractor or any subcontractors solely caused the quality escape; and 
(3) the quality escape caused substantial harm to the government.
---------------------------------------------------------------------------
    \1\ Quality escape is defined as: the contractor, or any 
subcontractors: (1) failed to detect a nonconformance or failed to 
follow command media (instructions); (2) the nonconformance or failure 
could adversely affect the component's performance or the performance 
of a system or subsystem; and (3) requires government or contractor 
action to bring the item back to compliance with specifications.
---------------------------------------------------------------------------
    The GMD DSC Contractor Accountability for Quality clause was 
approved for one-time use. If determined to be beneficial and product 
quality is improved, MDA will request the Under Secretary of Defense 
for Acquisition, Technology, and Logistics approve using a similar 
clause in future competitively awarded contracts.

                       savings under new contract
    2. Senator Levin. General O'Reilly, I understand that the new GMD 
DSC cost nearly $1 billion less than the government cost estimate, and 
that you reduced the cost of each GBI by some $20 million below the 
previous contract cost. How did you achieve such savings and will you 
seek to achieve such cost savings with future MDA contracts?
    General O'Reilly. The GMD DSC savings are attributable to a full 
and open competitive environment. The $1 billion less than the 
government cost estimate is expected to be realized during the next 7 
years of GMD DSC period of performance through innovations and 
efficiencies proposed by the winning contractor, including:

         An integrated weapon system management approach with a 
        flat organizational structure using lower cost centers and rate 
        structures
         Prime contractor teaming with existing GMD Original 
        Equipment Manufacturers
         Reducing program risk through upfront investment in 
        software development, procurement of obsolete interceptor 
        parts, and development of an Integrated Digital Environment to 
        provide a collaborative work environment tool that is projected 
        to both reduce and contain costs and risks
         Consolidating and relocating interceptor, ground 
        systems, test, development facilities and laboratories, 
        personnel, and equipment items
         No fee on Other Direct Costs (ODC) and a no fee-on-fee 
        approach, which means that the prime contractor will not charge 
        fee on the profit/fee portion of its subcontractors.

    MDA will execute appropriate market research as part of future 
acquisition strategy development to pursue if competition can achieve 
similar benefits for other programs.

    3. Senator Levin. General O'Reilly, are there other advantageous 
features of the new contract that you will seek to include in future 
MDA contracts?
    General O'Reilly. There are features in the GMD DSC that would be 
appropriate for other MDA programs. Those features under consideration 
for future acquisition strategies include:

         Quality clause for contractor accountability that will 
        incentivize delivery of quality, non-defective interceptors and 
        hold the contractor liable for all harm to the government, 
        including an ability to make previously earned performance 
        incentives subject to rescission
         Standard contract clause for direct government access 
        to subcontractors
         Performance-based logistics approach to maintain and 
        incentivize system operational availability
         Contractual provision that eliminates cost 
        inefficiencies by requiring the contractor's proposal, as well 
        as future change order proposals, to reflect a no fee on ODC 
        and a no fee-on-fee approach. This provision eliminates the fee 
        prime contractors would add on top of their subcontractors' 
        fee.

             why u.s. missile defense can't threaten russia
    4. Senator Levin. General O'Reilly, I understand you have had an 
opportunity to explain to the North Atlantic Treaty Organization 
(NATO)-Russia Council why our missile defense systems planned for 
Europe can't threaten Russia's nuclear deterrent missile force. Can you 
explain, on an unclassified basis, why our missile defenses can't 
threaten Russia's deterrent?
    General O'Reilly. I briefed the NATO-Russia Council on May 5, 2011, 
on why missile defense cannot threaten Russia's deterrent. The missile 
defense interceptors planned for Europe have insufficient velocity to 
threaten Russia's nuclear deterrent missile force. Russian 
Intercontinental Ballistic Missile (ICBM) launch facilities are spread 
over 2,000 miles of distance and five time zones. ICBMs launched from 
Russia to the United States travel over the North Pole, not within 
reach of interceptors launched from Poland or Romania where the 
European missile defense interceptors are located.

             independent report on cooperation with russia
    5. Senator Levin. Dr. Roberts, in February, an independent group of 
international experts, known as the Euro-Atlantic Security Initiative, 
issued a report recommending that the United States and NATO should 
cooperate on missile defense with Russia by sharing satellite and radar 
early warning information in joint cooperation centers. One of the 
report's leaders was Stephen Hadley, the National Security Advisor to 
President George W. Bush. Is their proposal consistent with U.S. and 
NATO proposals for cooperating with Russia on missile defense and does 
the administration support their proposal?
    Dr. Roberts. Cooperation with Russia on missile defense has long 
been a priority for both Republican and Democratic administrations. 
Successful U.S.-Russia cooperation in this area could send a strong 
signal to Iran that Iran's development of missiles and pursuit of 
nuclear capabilities are a waste of resources and are reducing rather 
than enhancing Iran's security. In addition, cooperation would add to 
the effectiveness of U.S., NATO, and Russian missile defenses, and it 
would help to improve U.S-Russia relations overall.
    Russia initially proposed the creation of NATO-Russia missile 
defense centers. The United States has welcomed the idea of data 
sharing between Russia and NATO, which would improve early warning and 
defense of all parties. Such data sharing is envisioned to take place 
in a NATO-Russia missile defense data fusion center. Such sharing could 
have direct operational benefits, resulting in a more efficient and 
effective defense. A second potential center, the NATO-Russia Planning 
and Operations Center, would have the function of coordinating missile 
defense efforts. Any agreements on such centers or any other form of 
data sharing would have to be consistent with U.S. National Disclosure 
Policy and other applicable laws.
    There would also be wider political benefits to cooperation. NATO 
and Russia working together on missile defense would send a strong 
signal to regional actors that ballistic missile proliferation will not 
go unchallenged. Cooperation would enhance strategic stability by 
improving the U.S.-Russia and NATO-Russia relationships, and could pay 
further dividends by building cooperative relationships that might flow 
to other areas.

    6. Senator Levin. Dr. Roberts, is it correct that we already share 
such early warning information with numerous countries?
    Dr. Roberts. Yes, the United States does share early warning 
information with select foreign countries. All sharing of classified 
military information is conducted in accordance with U.S. National 
Disclosure Policy and other applicable law and policy. Classified 
military information is only shared when there is a clearly defined 
benefit to U.S. security. In addition, the content and scope of such 
information shared is defined in a specific agreement with the country 
in question.

                    sharing information with russia
    7. Senator Levin. General O'Reilly, you have indicated previously 
that Russian radar data would be useful in enhancing our missile 
defense capability relative to Iran. I want to clarify what sort of 
data you have in mind. As I understand it, there is relatively 
unspecific early warning data, which could be shared on an unclassified 
basis with other nations, that would provide warning that a missile had 
been launched and would land in a certain area at a certain time. But 
that information is not precise enough to enhance missile defense 
operations. There is also, however, very precise and specific 
information on the position and velocity of a threat missile, what is 
called a missile track, that would contribute to the ability to defeat 
a threat missile. I gather that missile track information is 
classified, but we have such information and Russia has it from radars 
in different places. If Russia and the United States shared missile 
track information, would that enhance our ability to defeat Iranian 
ballistic missiles?
    General O'Reilly. Yes, sharing missile track information has the 
potential to enhance both United States and Russian ability to defeat 
projected Middle Eastern threat ballistic missiles.
    Sharing unclassified early warning data would speed reaction times 
and increase situational awareness. Beyond unclassified data, the 
potential exchange of classified missile tracks could increase raid 
capacity and probability of engagement success.

    8. Senator Levin. General O'Reilly, given that Russia has radars in 
locations where we do not, if Russia shared missile track data, would 
it improve our missile defense capabilities relative to North Korea?
    General O'Reilly. Yes, sharing missile track information with 
Russia would improve our ability to defeat North Korean ballistic 
missiles.

    9. Senator Levin. General O'Reilly, in your view, could we share 
such information with Russia without compromising the security or 
capability of our missile defenses?
    General O'Reilly. Yes. Sharing missile tracking data would not 
necessarily reveal capabilities of, or vulnerabilities to, the system. 
We informed the committee in November 2011 that since 2001, in 
accordance with National Disclosure Policy and procedures, the MDA 
disclosed limited classified missile defense information/data to 
Russian Federation personnel observing two missile defense test events. 
In both cases, MDA requested and was granted an Exception to National 
Disclosure Policy to enable this data release. The overall impact on 
security or capability of our missile defense depends on the decision 
regarding what information to share with the Russian Federation. As 
such, the U.S. ability to share early warning or other specific missile 
track data with the Russian Federation depends on the classification 
and the level of detail in the data.
    In order to share information, we would need a formal Defense 
Technology Cooperation Agreement (DTCA). The United States will only 
provide the Russian Federation information that is consistent with both 
National Disclosure Policy, which limits information disclosure to the 
Russian Federation to unclassified information only, and guidance 
contained in the National Defense Authorization Act for Fiscal Year 
2012, section 1244 ``Sharing of Classified United States Ballistic 
Missile Defense Information With The Russian Federation.''

                fly-before-you-buy acquisition strategy
    10. Senator Levin. General O'Reilly, General Formica, Mr. Gilmore, 
Dr. Roberts, and Ms. Chaplain, the Ballistic Missile Defense Review 
(BMDR) stated our policy that before new missile defense systems are 
deployed they must be tested in a manner that permits evaluation in a 
realistic manner. This policy indicates that we will not deploy a new 
system before it has demonstrated its capability through realistic 
testing. Would you agree that we should not deploy any new missile 
defense systems unless and until they have demonstrated their 
capability through realistic flight testing--even if that means taking 
longer than the original timelines announced for the European Phased 
Adaptive Approach (EPAA)?
    General O'Reilly. I agree. The Fly-Before-You-Buy acquisition 
strategy, and demonstrating capability through realistic flight-
testing, are Ballistic Missile Defense System (BMDS) priorities. 
Operationally realistic testing is also a priority highlighted in the 
2010 BMDR report. Comprehensive testing has always been the cornerstone 
of the MDA's development efforts.
    Flight testing of BMDS capabilities planned for different phases of 
the EPAA is scheduled for completion before production decisions and 
fielding timelines. For example, the SM-3 Block IB is being flight-
tested this year, including the recent successful intercept in early 
May. Production decisions for the SM-3 Block 1B will depend on 
successful completion of additional flight tests.
    General Formica. The policy expressed in the BMDR is sound. As a 
warfighter, I'm interested in the timely delivery of relevant 
capabilities. MDA, utilizing a robust test program, delivers those 
capabilities. MDA's approach provides a reasonable balance of getting 
tested capabilities to the warfighter in a timely manner.
    Mr. Gilmore. I agree that we should not deploy any new missile 
defense systems unless and until they have demonstrated their 
capability through realistic flight testing. Prior to a system or 
element transitioning to a service for deployment, the system should 
undergo adequate flight testing to verify, validate, and accredit the 
modeling and simulation and operational testing to determine the 
system's capability with a reasonable level of statistical confidence. 
Recent examples include extensive Aegis Ballistic Missile Defense 
(Aegis BMD) 3.6.1 testing leading up to FTM-15 in support of Phase 1 of 
the EPAA, and the Terminal High Altitude Area Defense (THAAD) Initial 
Operational Test and Evaluation (FTT-12) in support of a full rate 
production decision. Deployment timelines should be event-driven, where 
required system capabilities have been adequately demonstrated, and not 
schedule-driven. The Integrated Master Test Plan (IMTP), Version 12.1, 
that General O'Reilly and I approved on March 1, 2012, includes 
extensive flight testing supporting the Phase 2 EPAA. This testing will 
consist of 9 Aegis BMD 4.01/5.0 intercept flight tests (10 intercepts) 
using SM-3 Block IB (9)/Block IA (1) missiles; 3 Aegis BMD 4.01/5.0 
flight test simulating 7 intercepts; 3 Aegis Ashore flight tests (2 
intercept tests); and a final operational test (FTO-02) involving an 
Aegis BMD ship-board intercept, an Aegis Ashore intercept, a THAAD 
intercept, and a Patriot intercept. The MDA has planned all this 
testing to be complete by December 31, 2015, to meet the President's 
Phase 2 EPAA timeline.
    Dr. Roberts. Before new capabilities are deployed, they must 
undergo testing that enables an assessment under realistic operational 
conditions against threat-representative targets to demonstrate that 
they can reliably and effectively help U.S. forces accomplish their 
mission. The administration is committed to this approach, best 
characterized as fly-before-you-buy, which will result in a posture 
based on proven technology in order to improve reliability, confidence, 
and cost control. To date, the only anticipated delay to the EPAA 
schedule is due to the funding cut to the SM-3 IIB program from the 
President's budget request for fiscal year 2012.
    Ms. Chaplain. The GAO concurs with the administration's commitment 
in the BMDR to deploy capabilities that have been proven under 
extensive testing and assessment and are affordable over the long term. 
Extensive testing is a key tenet of GAO's knowledge-based approach, 
which we have found in our work in both government and commercial 
acquisitions helps to ensure delivery and deployment of systems with 
the performance desired at a cost and schedule that is both affordable 
and on time. While we concur with the BMDR commitment, our knowledge-
based approach goes further in finding that extensive testing is also 
crucial to the production decision, which usually occurs many years 
before capabilities are deployed. We have found that premature 
commitments to production have led to expensive efforts to resolve or 
mitigate problems after systems are fielded. We reported this year that 
the GBI continues to suffer from the premature commitment to 
production.
    In our April 2012 report, we determined that MDA has undertaken and 
continues to undertake highly concurrent acquisitions in response to 
the 2002 presidential direction to initially rapidly field and update 
missile defense capabilities as well as the 2009 presidential 
announcement to deploy missile defenses in Europe. This concurrency can 
be seen in programs that proceed into product development before 
technologies are mature or appropriate system engineering has been 
completed. But it also exists in programs that proceed into production 
before a significant amount of independent testing is conducted to 
confirm that the product works as intended. While MDA has embraced the 
value of reducing unknowns before making key decisions in some of its 
newer programs, such as the SM-3 Block IIA, and adopted good practices, 
such as awarding competitive contracts to multiple contractors in the 
SM-3 Block IIB program, it continues to plan and implement highly 
concurrent approaches. In fact, today, MDA is still operating at a fast 
pace, as production and fielding of assets remains, in many cases, 
ahead of the ability to test and validate them. In light of MDA's long 
history of pursuing highly concurrent acquisitions in order to meet 
challenging deadlines set by the administration, we recommended in our 
report that DOD review the extent to which the EPAA capability delivery 
dates are contributing to concurrency in missile defense acquisitions 
and recommend schedule adjustments where significant benefits can be 
obtained by reducing concurrency.
                                 ______
                                 
           Questions Submitted by Senator E. Benjamin Nelson
                  hedging strategy status and results
    11. Senator Nelson. Dr. Roberts, as indicated in the BMDR, the 
Department of Defense (DOD) has been engaged in a Homeland defense 
hedging strategy review, considering options to enhance our defensive 
capability in case the threat emerges more quickly or robustly than 
anticipated. I understand that quite a number of actions have already 
been decided or implemented, and others are still under consideration. 
Can you explain what actions have already been decided or implemented 
as a result of the hedging strategy review?
    Dr. Roberts. Key elements of the hedge were set out in the BMDR 2 
years ago, including completion of the second field of 14 silos at Fort 
Greely, AK. This increases the availability of silos in the event that 
additional GBI deployments become necessary. Additionally, we continue 
to develop the two-stage GBI.
    The commitment made in the BMDR to being well hedged is further 
reflected in a request to purchase an additional five GBIs in the 
fiscal year 2013 budget. This action provides an option to emplace 
additional missiles in Missile Field 2 rapidly, if necessary. It will 
also maintain enough GBIs for testing and operational spares. This 
decision also keeps the GBI production line warm in case the purchase 
of additional GBIs is needed in the future. These decisions follow the 
commitment in the BMDR to pursue additional programs to hedge against 
future uncertainty. To support those decisions, DOD is conducting a 
comprehensive review of possible future developments in the projected 
threat and of how best to ensure timely response to unpredicted threat 
developments.

    12. Senator Nelson. Dr. Roberts, what is the current status of the 
review, do you expect any further decisions soon, and will the review 
process continue as the threat evolves?
    Dr. Roberts. DOD is continuing to work to deliver the hedge report 
to Congress as soon as possible. Given the sensitive intelligence basis 
of the hedging strategy review, and also the classified performance 
characteristics of U.S. systems, the results of the review can only be 
discussed in an appropriate setting. As stated in the BMDR, DOD is 
committed to pursuing additional programs to hedge against future 
uncertainty.

                  gbi reliability improvement program
    13. Senator Nelson. Dr. Roberts, regarding our efforts to improve 
our GBIs for Homeland defense, in previous testimony you noted that we 
have ``an aggressive GBI reliability improvement program'' that is 
intended to ``reduce the number of GBIs required per intercept, which 
will increase the number of ICBMs that can be defeated by the GMD 
system.'' You also noted that we could ``double the number of ICBMs the 
current force is capable of defeating without adding a single new 
GBI.'' Can you describe how this GBI reliability effort fits into our 
strategy?
    Dr. Roberts. The GMD system currently protects the United States 
from limited ICBM attacks. Due to continuing improvements in the GMD 
system and the number of GBIs now deployed compared to potential North 
Korean and Iranian long-range ballistic missile capabilities, the 
United States possesses a capability to counter the projected threat 
from North Korea and Iran for the foreseeable future. The GBI 
reliability effort is a key part of our continuing commitment to 
improve the GMD system.
    The GMD milestones for increasing reliability include successful 
GBI flight testing, GBI component reliability growth testing, upgrade 
of current GBIs, and delivery of the new version of GBIs. While 
component reliability testing will be conducted over the life of the 
program, additional GBI component testing is being planned for fiscal 
years 2013 to 2015. Capability Enhancement (CE)-I interceptors will 
continue to be upgraded through fiscal year 2017. Manufacturing of CE-
II interceptors will restart in the second quarter of fiscal year 2013.
    The milestones for increasing discrimination include completion of 
testing to provide the capability to process near-term discrimination 
data from BMDS sensors. Options to improve Exoatmospheric Kill Vehicle 
(EKV) on-board discrimination capabilities are under study and will be 
incorporated in the next EKV software upgrades.

    14. Senator Nelson. General O'Reilly, can you describe the scope of 
the program in unclassified terms?
    General O'Reilly. The MDA's plan to improve the reliability of GBIs 
consists of four initiatives: Fleet Upgrade Program, Flight Test 
Rotation Program, Reliability Growth Testing Program, and Component 
Reliability Program. These initiatives will be guided by a Boeing-led 
GBI reliability assessment, part of the recently awarded DSC. The 
assessment, to be completed in early fiscal year 2013, will evaluate 
all GBI components against known risks, design operating life 
requirements, and environments. The results will identify components 
for additional reliability growth that require development, 
procurement, testing, and replacement.
    GBI Fleet Upgrade Program removes fielded interceptors from silos, 
upgrades them to remove known risks, performs mandatory maintenance, 
and replaces limited-life items. After acceptance testing, the program 
returns the upgraded interceptors to the operational fleet. Replaced 
components are used in the Component Reliability Program. All currently 
fielded interceptors will be upgraded by the end of fiscal year 2017. 
Reliability and performance upgrades to the GBI booster and EKV are in 
development and planned for integration into five new-build GBIs. Four 
of the new-build interceptors will be placed into service in fiscal 
year 2016 through fiscal year 2017. One is planned for flight test as 
described in the IMTP.
    Flight Test Rotation Program removes older interceptors from silos, 
performs a limited upgrade to meet flight test configuration 
requirements, performs mandatory maintenance, and replaces limited-life 
items. After acceptance testing, the program delivers what is now a 
test interceptor for the flight test program. The removed interceptors 
are replaced by new or upgraded GBIs.
    The GBI Reliability Growth Testing Program ensures that corrections 
to known risks are effective and eliminate risks. In the near-term, 
Control Test Vehicle-One (CTV-01) and Flight Test Ground-based 
Interceptor (FTG)-06b are the final verification test milestones to 
demonstrate the design fixes to correct the problems uncovered in the 
FTG-06a flight test. There will be additional ground testing of 
components and assemblies to verify design fixes, demonstrate component 
reliability, qualify the item, and increase confidence in component 
reliability.
    The Component Reliability Program includes testing, analyzing 
trends, and identifying reliability improvements for GBI component 
hardware. Service life extension testing will continue for one-shot 
devices, including the firing of all one-shot devices removed from 
fielded interceptors during upgrade and flight test rotation to obtain 
performance reliability data. The program identifies older interceptors 
for disassembly and component reliability testing. Over the next 7 
years, four interceptors will be removed from service and undergo 
reliability testing.

    15. Senator Nelson. General Formica, from a warfighter perspective, 
how significant would it be if we could double the number of ICBMs we 
could defeat with our current number of GBIs?
    General Formica. While there may be strategic considerations to 
take into account, from an operational perspective, it would be a 
significant advantage if we could double the number of ICBMs we can 
defeat with the current inventory of GBIs. The current U.S. Northern 
Command (NORTHCOM) shot doctrine is optimized to balance risk against 
system capability. Improvements to the GBI, sensor capabilities, and 
deterrence would be key considerations for the commander of NORTHCOM to 
revise shot doctrine.

               benefit of precision tracking space system
    16. Senator Nelson. General O'Reilly, your prepared testimony 
includes the following statement about the value of the Precision 
Tracking Space System (PTSS) under development: ``The greatest future 
enhancement for both Homeland and regional defense in the next 10 years 
is the development of the PTSS satellites, which will provide fire-
control quality track data of raids of hostile ballistic missiles over 
their entire flight trajectories. . . . '' Can you explain why you 
believe PTSS would provide such a significant contribution to missile 
defense and how it would differ from our current radar-based sensor 
system?
    General O'Reilly. PTSS is being designed and developed to meet the 
needs documented in the Air and Missile Defense Prioritized 
Capabilities List (PCL), the primary input from the U.S. Strategic 
Command (STRATCOM)-led Warfighter Involvement Process to MDA's 
requirements process. Specifically, as an agile, effective sensor 
against mobile and emerging threats, it will uniquely address the post-
boost challenge, continuous tracking of ballistic missile objects, 
increased raid capacity, and object characterization and 
discrimination. PTSS track data will be available to any missile 
defense weapon system connected to the BMDS fire control network.
    PTSS will contribute to missile defense by expanding interceptor 
access to the early post-boost phase of a ballistic missile's flight, 
preventing an adversary missile from traversing undetected into 
midcourse and using advanced countermeasures. PTSS will increase BMDS 
capability by providing the warfighter a shoot-assess-shoot engagement 
tactic essential to the efficient use of interceptor inventory, and 
will defeat adversary attempts to evade defense in all phases of 
flight.
    The constellation will support simultaneous missile defense 
operations against widely separated adversaries, and provide 
simultaneous coverage from threats to the United States, deployed 
forces, and friends and allies without the logistic or political 
challenges to basing terrestrial sensors in other countries. PTSS will 
increase BMDS raid handling capacity and engagement success by 
providing early views of midcourse countermeasures and preferential 
tracking of threats that carry multiple warheads or complex 
countermeasures. The system will provide fire control support to early 
thinning of raids to avoid saturation in subsequent layers, one of the 
first steps in the discrimination process through persistent track.
    Consisting of multiple, mutually reinforcing sensor systems (radar 
and infrared, or IR), PTSS will provide on-demand sensor coverage, and 
will cover the ballistic missile battlespace from threat ignition to 
reentry. The low Earth orbit satellite constellation and ground-
processing infrastructure will track medium-, intermediate-, and long-
range ballistic missiles in the post-boost and midcourse phases of 
flight, providing early access to threats launched from land, sea, and 
the deepest interiors of countries. For comparison, PTSS will provide 
sensor coverage for over 70 percent of the Earth for approximately $75 
million per year in operations and sustainment costs, compared to AN/
TPY-2 sensor coverage of only one theater for approximately $150 
million per year in operations and sustainment costs.
    PTSS's precise and expanded sensor coverage, without the need for 
host nation basing agreements or advance warning of an impending 
attack, provides beyond line-of-sight tracking not possible with 
horizon-limited terrestrial sensors. PTSS's over-the-horizon capability 
will greatly extend the operating areas of land- and sea-based defense 
units, and will also expand the geographical territory that can be 
protected by a single fire unit, leading to significantly more 
efficient employment of limited interceptor inventory. Integrated with 
the BMDS sensor network, PTSS will fill the time gap between the end of 
overhead persistent IR satellite boost phase tracks and the start of 
midcourse radar tracks. Sensor coverage for critical threat corridors 
will be provided where early commit-quality radar coverage is fiscally 
and politically not sustainable. Post-boost IR tracking from space also 
increases BMDS survivability and denies adversaries the ability to 
optimize attacks to circumvent radar-only defenses. PTSS will increase 
BMDS sensor capability for an uncertain future where threats may come 
from new adversaries and geographically diverse regions not under 
consideration today.

    17. Senator Nelson. General O'Reilly, in your view, what would be 
the impact on our missile defense capability if we did not develop and 
deploy the PTSS?
    General O'Reilly. There will be several critical impacts to the 
BMDS if the PTSS is not developed and deployed:

    (1)  No realistic way to expand and rapidly adjust coverage to meet 
evolving threats. PTSS provides persistent, near-global fire control 
quality sensor coverage of prospective ballistic missile launch sites 
and attack corridors. PTSS coverage includes not just the land masses 
of current potential adversaries, but also broad ocean areas and new 
territories from which future adversaries could threaten the United 
States and its interests. Terrestrial deployment options with similar 
capabilities would necessitate impractical and unaffordable deployment 
of fixed and/or transportable radars, available on demand, and then 
only when their use was not outright precluded by geographical 
obstacles or host nation politics.
    (2)  Warfighter needs for the BMDS are documented in the Air and 
Missile Defense PCL, a major product of the STRATCOM-led Warfighter 
Involvement Process. PTSS is being designed and developed to meet these 
needs by providing persistent coverage for over 70 percent of the 
Earth's surface, specifically in the projected threat areas. As an 
agile, effective sensor against mobile and emerging threats, it 
uniquely addresses the post-boost challenge, continuous tracking of 
ballistic missile objects, increased raid capacity, and object 
characterization and discrimination through persistent track.
    (3)  Scores of ballistic missiles can be in flight simultaneously, 
placing severe loads on sensor and weapon resource managers. PTSS is 
the only sensor system in the architecture that can provide the track 
handling capacity and the engagement battlespace necessary to 
neutralize mass raids.
    (4)  Architecture would be susceptible to technical and tactical 
countermeasures designed to exploit the vulnerabilities of a radio 
frequency-only sensor architecture. It is more difficult and expensive 
for adversaries to design credible countermeasures against 
architectures that combine parallel or serial looks at a threat using 
both radio frequency and electro-optic sensors. Sensor coverage in 
depth would also result in adversaries being less effective with 
precursor suppression attacks against BMDS assets.
    (5)  Without PTSS BMDS will have gaps for threats and launch 
locations between Overhead Persistent Infrared boost phase tracking 
sensors and midcourse fire control radars. Within that sensor coverage 
gap the offense could choose to deploy, deceive, confuse, and/or evade 
the BMDS. PTSS fills that coverage gap, placing severe pressure on 
adversary timelines and depriving the offense of free rides into 
midcourse.

                     priorities for missile defense
    18. Senator Nelson. General Formica, each year STRATCOM creates the 
STRATCOM Integrated Air and Missile Defense PCL which expresses the 
integrated missile defense priorities of the combatant commands. 
General O'Reilly's prepared statement notes that, ``the need for 
persistent full trajectory tracking of ballistic missiles is one of the 
warfighter's highest development priorities as stated in the 2012 
STRATCOM PCL.'' Can you confirm in an unclassified manner that it is 
one of the highest priorities of the STRATCOM PCL to develop a 
persistent full trajectory missile tracking capability?
    General Formica. Yes, the need for persistent full trajectory 
tracking of ballistic missiles is one of the highest priorities. Full 
trajectory tracking expands our options to defeat the missile threat, 
and enhances our early warning capability. PTSS would be a critical 
component of this capability as it could provide sensor coverage in 
depth, expands our tracking capability for large raid sizes, and 
reduces our reliance on terrestrial sensors.

                          future sensors study
    19. Senator Nelson. General Formica, I understand that you led a 
study for STRATCOM on future sensors for missile defense and that the 
study considered the PTSS now under development. In unclassified terms, 
can you explain whether your study indicated that PTSS would provide an 
important capability for future missile defense of the Homeland and of 
regional missile threats?
    General Formica. STRATCOM led the Remote Sensor Assessment which 
included PTSS. At JFCC IMD, we participated directly in STRATCOM's 
assessment. While classified, the results of the study confirmed that 
PTSS would be a critical component of both Homeland and regional 
missile defense as it greatly enhances sensor coverage. The results of 
this study have been briefed to congressional staff, the Missile 
Defense Executive Board (MDEB), and informed the budget submission.

           deploying standard missile-3 block iib interceptor
    20. Senator Nelson. General O'Reilly, you are seeking to develop 
the SM-3 Block IIB interceptor for Phase 4 of the EPAA. That missile is 
planned for deployment at Aegis Ashore sites in Romania and Poland to 
intercept potential future long-range Iranian missiles. I understand 
that such a missile might not be deployed on ships for safety reasons 
if its fuel is too dangerous. Do you believe it is possible that the 
missile could be made safe for deployment on ships and, if so, do you 
believe that that would be a significant enhancement to our missile 
defense capability?
    General O'Reilly. Yes, it is possible to safely deploy SM-3 Block 
IIB on ships. The MDA, in cooperation with the U.S. Navy, will design 
the SM-3 Block IIB to have both sea-based and ashore capability. The 
industry concept development teams have been given direction to propose 
ship-compatible SM-3 Block IIB concepts.
    The SM-3 Block IIB design is being optimized for its primary 
mission to counter first generation ICBMs targeted at the U.S. Homeland 
as a first and independent interceptor layer. Developing and deploying 
the SM-3 Block IIB at sea and ashore will maximize deployment options 
for a flexible response to emerging and evolving threats. The SM-3 
Block IIB will also provide a significant enhancement to current 
missile defense capability by expanding the battle space against 
medium-range and intermediate-range ballistic missiles.

    21. Senator Nelson. General Formica, from a warfighter's 
perspective, would you support having the SM-3 Block IIB deployed at 
sea? Please explain your view.
    General Formica. Yes, I am supportive of the SM-3 Block IIB 
capabilities and believe its fielding, both at sea and on land, will 
provide operational advantages against a limited ballistic missile 
attack. I understand there are significant technical challenges and 
safety concerns that would need to be resolved in order to deploy the 
SM-3 Block IIB on board ships.

                    east coast missile defense sites
    22. Senator Nelson. General O'Reilly, when the missile defense site 
in Alaska was being debated, we understood that no GBI flight tests 
would take place from Fort Greely, AK, because of concern that a 
booster might cause damage to people or property on the ground where it 
falls. If people are considering an east coast GBI site, which would be 
much more densely populated than Alaska, wouldn't there also be a 
concern for possible damage that GBI boosters could cause within some 
distance from the site?
    General O'Reilly. Potential siting locations for an east coast GBI 
site would have similar considerations with regard to possible damage 
to people or property on the ground from the two GBI booster stage 
drops, and would have to account for a 50 km radius for a first stage 
booster drop zone and a 600 km radius for a second stage booster drop 
zone.
    If a decision were made to construct an east coast GBI site, the 
site selection and operational implementation would include hazard 
assessment and mitigation measures to limit potential damage from 
booster stage drops as a result of an operational launch in response to 
a ballistic missile attack. The evaluation of hazards to the public is 
part of the siting analysis process that would be completed prior to 
beginning any east coast missile field construction. As with the Alaska 
GBI missile field, an east coast GBI site would only be used to defend 
against an actual ballistic missile attack and not for testing.

            benefit of radar in turkey for homeland defense
    23. Senator Nelson. General O'Reilly, at the end of last year, the 
United States began operating a forward-based X-band radar (designated 
AN/TPY-2) in Turkey as part of Phase 1 of the EPAA to missile defense. 
In addition to improving protection of Europe against ballistic 
missiles from Iran, this radar also is said to improve our defense of 
the Homeland against potential future long-range missiles from Iran. 
Can you explain how this radar in Turkey helps our Homeland defense 
capability?
    General O'Reilly. (Deleted.]

    24. Senator Nelson. General Formica, do you believe this forward-
deployed radar in Turkey is a significant contribution to our Homeland 
defense capability?
    General Formica. The forward-based AN/TYP-2 radar in Turkey was 
deployed as a U.S. contribution to NATO territorial defense as part of 
the EPAA. It contributes to Homeland defense and supports deterrence 
and assurance. As future missile defense capabilities are deployed to 
the European region, the radar's contribution to Homeland defense will 
increase.

                   concerns about contractor quality
    25. Senator Nelson. Ms. Chaplain, your testimony included a 
discussion of quality problems with MDA's contractors, including 
problems that caused failed flight tests and cost hundreds of millions 
of dollars for the rescheduled tests. You note that MDA has included a 
quality clause in its new GMD contract, but that there has not yet been 
time to assess its effect. Do you plan to monitor the impact of this 
clause and other steps to improve contractor quality performance for 
missile defense?
    Ms. Chaplain. As part of our ongoing missile defense work, we 
regularly meet with the GMD program office and contractors and follow-
up on programmatic and technical progress in the program. We plan to 
monitor quality issues as we have in the past, and to also monitor the 
effect of this clause should a quality problem occur and the government 
take action under this clause. We will report future findings, if they 
arise, as part of our mandated reviews of the BMDS.
                                 ______
                                 
              Questions Submitted by Senator Jeff Sessions
                     ground-based midcourse defense
    26. Senator Sessions. General O'Reilly, the recent GMD contract 
competition is indicative of the impact competition can have in 
benefiting taxpayers. The new DSC is estimated to achieve at least a 20 
percent cost savings over the contract it replaces and provides for an 
option to procure five additional GBIs. Is this new contract a firm-
fixed price contract?
    General O'Reilly. The DSC, HQ0147-12-C-0004, is comprised of 
multiple contract types that vary by the requirement's complexity as 
follows:
       
    
    
      
    The Fixed Price Incentive-Firm Target (FPIF) structure is similar 
to a firm fixed price arrangement in that the contractor may reach a 
point of total assumption (PTA) in which the contractor bears all costs 
to complete the remainder of the requirement. A target cost is 
established, along with a share ratio which determines the percentage 
which the government and contractor share for overrun or underrun. For 
example, the share ratio may provide that the government pays 70 
percent of the overrun and the contractor pays 30 percent. The 
contractor's share is paid out of the contractor's target profit until 
the PTA is reached. At the PTA, the contractor has reached a point 
where all remaining costs between the PTA and the FPIF ceiling price 
(equivalent to a firm fixed price) are paid for out of the contractor's 
remaining profit on the contract. Once the ceiling price is reached, 
the contractor's profit is exhausted, but the contractor must still 
complete performance, and pay any additional costs to complete out of 
corporate funding; there is no further liability by the government for 
any additional costs above the ceiling price. So, in essence, the FPIF 
contract provides some margin to address program and cost uncertainty, 
but at a certain point (PTA) the contractor becomes responsible for all 
remaining costs of performance (similar to a firm fixed price 
contract). In the case of the DSC FPIF, the share ratio is 50/50, and 
the ceiling price is 120 percent of target cost.
    In the case of the Cost-Plus-Incentive-Fee (CPIF) arrangement 
(which constitutes 82 percent of the overall contract price), the 
arrangement enables the contractor to bill for actual costs of 
performance (subject to allowability criteria set forth in the Federal 
Acquisition Regulation), but the CPIF still provides a specific 
incentive for the contractor to control costs. Similar to the FPIF 
arrangement, in a CPIF a target cost is established, and then a share 
ratio is established which provides the basis by which the government 
and contractor share the overrun according to a predetermined formula. 
The difference between the FPIF and CPIF contract types is that the 
FPIF type reflects lower risk to the contractor, thus it has a ceiling 
price that converts to firm fixed price. The CPIF contract type has 
greater risk to the contractor, thus there is no ceiling price, and 
minimum and maximum fees are applicable. In the case of DSC, the CPIF 
arrangement calls for a 60/40 share ratio for overruns, meaning that 
the contractor must pay 40 percent of the overrun until the minimum fee 
is reached. The target fee is $162 million and the minimum fee is $72 
million, which means that $90 million, or over half of the contractor's 
fee, is at risk in the event of any cost overruns. These dollar amounts 
and percentages were proposed by Boeing as part of the source 
selection. Generally speaking, a 60/40 share ratio is extremely steep 
for a CPIF contract; the government's interests are adequately 
protected.
    The CPAF arrangement provides for an estimated cost and an award 
fee which is paid based on the government's subjective evaluation based 
on criteria contained in an Award Fee Plan. Those criteria typically 
deal with performance and responsiveness, and provide the government 
significant leverage. If the contractor is not performing well in areas 
that relate to the award fee criteria, then the government will 
normally reduce the fee as part of its determination.

    27. Senator Sessions. General O'Reilly, does the MDA intend to 
exercise the option for five additional GBIs?
    General O'Reilly. Yes. The MDA intends to exercise the DSC option 
to manufacture five additional CE-II interceptors in fiscal year 2013.

    28. Senator Sessions. General O'Reilly, does MDA believe that the 
threat may merit the deployment of additional GBIs, and if so, why is 
the option only for five additional interceptors?
    General O'Reilly. Based on current threat projections, 30 
operational GBIs are sufficient to protect the United States from a 
limited ICBM raid launched from projected regional threats.
    Procuring 5 additional GBIs (57 total) will make available 16 
interceptors for IMTP events, and 11 interceptors for reliability 
growth program testing and spares in addition to the 30 operational 
interceptors. In doing so, IMTP events, reliability growth program, and 
spare interceptors will be supported through 2032.
    If future threat assessments indicate this capability is 
insufficient against a growing ICBM threat, operational GBI firepower 
could be increased by filling out all 38 operational silos in the new 
Missile Field-2 (increase of 8), refurbishing and making available the 
6-silo prototype missile field (MF-1) for a total of 44 operational 
silos, and accelerating delivery of new sensor and interceptor 
capabilities.

    29. Senator Sessions. General O'Reilly, does MDA believe that long-
term GMD sustainment and flight test needs may require additional GBIs?
    General O'Reilly. (Deleted.]

    30. Senator Sessions. General O'Reilly, is the option for 
additional GBIs a firm fixed price option, and if not, why not, and 
what prevents the contractor from recovering profit lost under the 
umbrella contract on the price it charges for the procurement of the 
five additional GBIs?
    General O'Reilly.

    (1)  The option for additional GBIs is not firm fixed price.
    (2)  Due to the continuing research and developmental nature of the 
interceptors, the option for additional interceptor manufacturing is a 
CPIF-type CLIN. At this stage of the ongoing development and associated 
testing of the interceptors, a firm fixed price contract would be cost 
prohibitive to the government due to the contingencies the contractor 
could include in the proposed price.
    (3)  While a cost reimbursable arrangement would typically place 
the majority of risk on the government, the use of incentive fee with 
both performance and cost control incentives guarantees the contractor 
will lose potential fee should there be overrun on those affected 
CLINs.

    31. Senator Sessions. General O'Reilly, if I remember correctly, 
the Multiple Kill Vehicle (MKV) program which was canceled in 2009 was 
supposed to be the successor to the CE-II kill vehicle. Does the GMD 
modernization strategy include plans for upgrading or replacing current 
kill vehicles with new ones?
    General O'Reilly. (Deleted.]

    32. Senator Sessions. General O'Reilly, could SM-3 IIA MKVs be 
integrated onto a GBI to increase the number of intercepts possible per 
GBI?
    General O'Reilly. No. Though the GBI's physical dimensions can hold 
one or more SM-3 IIA kill vehicles, these kill vehicles are not 
compatible with the GBI mission. The SM-3 IIA kill vehicle is designed 
to engage intermediate, medium-range and certain short-range ballistic 
missile threats. The GBI EKV is designed to engage ICBM threats over a 
broader battle space.
    The GBI mission requires that the GBI kill vehicle operate eight 
times longer than the currently designed SM-3 IIA kill vehicle. The in-
flight communication frequencies of the SM-3 IIA kill vehicle are also 
incompatible with the GBI weapon system. These incompatibilities are 
also applicable in a GBI with multiple SM-3 IIA kill vehicles.

    33. Senator Sessions. General O'Reilly, what is the current service 
life expectancy of the CE I and CE II MKVs?
    General O'Reilly. (Deleted.]

                         sea-based x-band radar
    34. Senator Sessions. General O'Reilly, the fiscal year 2013 budget 
proposes to mothball the Sea-Based X-Band Radar (SBX) and transition it 
to limited test support status. However, I question whether everyone is 
in agreement with your proposal given U.S. Pacific Command's (PACOM) 
recent request that SBX be deployed to observe the recent failed North 
Korean launch. Did PACOM endorse the MDA's proposal to mothball SBX? If 
so, do MDA and PACOM agree that the funding requested may not be enough 
to support multiple deployments like the one in response to the North 
Korean launch?
    General O'Reilly. The SBX radar is not going to be mothballed. The 
President's budget request for fiscal year 2013 proposes to place the 
SBX radar in limited test support status. In this status, the SBX radar 
will retain its unique capabilities.
    Its technical performance capability will continue to be tested and 
exercised, including connectivity to the GMD Fire Control System. SBX 
will also maintain its American Bureau of Shipping (ABS) and Coast 
Guard certifications, and will be staffed to maintain the vessel, X-
band radar (XBR), and other critical systems for support to both 
testing and contingency activation.
    The MDA is collaborating with all to optimize SBX availability and 
support for operating in future BMDS flight tests. MDA is also working 
with the Joint Staff, STRATCOM's Joint Functional Component Command for 
Integrated Missile Defense, and the combatant commands to determine SBX 
response times to support contingency operations when directed. The 
recent successful SBX deployment to observe the failed North Korean 
launch is an example of the support the SBX can provide, in limited 
test support status, to contingency operations.
    Funding for contingency operations will be determined on a case-by-
case basis.

    35. Senator Sessions. General O'Reilly, in testimony before this 
committee back in June 2010, then Vice Chairman General Cartwright 
testified that SBX played a key role in facilitating a shoot-look-shoot 
capability for GMD. According to General Cartwright, ``the addition of 
the SBX also took some of the stress off of the midcourse. It allowed 
us to tell--that was the first capability that we had that told us 
whether we actually hit the missile or not.'' Is it true that SBX helps 
facilitate a shoot-look-shoot capability? If so, what has changed to 
justify the early retirement of SBX?
    General O'Reilly. (Deleted.]

                       homeland hedging strategy
    36. Senator Sessions. Dr. Roberts, as I mentioned in my opening 
remarks, I am disappointed that little has been relayed to Congress on 
how this administration intends to hedge the technological and threat-
based risk associated with missile defense in Europe. Secretary Gates 
told us that you would continue the development of the two-stage GBI as 
a contingency to the SM-3 IIB, but little to date has been provided to 
Congress to explain what that means. What is the current status of the 
hedging strategy and when will it be delivered to Congress?
    Dr. Roberts. DOD is continuing to work to deliver the hedge report 
to Congress as soon as possible. Given the sensitive intelligence basis 
of the hedging strategy review, and also the classified performance 
characteristics of U.S. systems, the results of the review can only be 
discussed in an appropriate setting.

    37. Senator Sessions. Dr. Roberts, protecting the Homeland from the 
possibility of a long-range Iranian threat is a real concern, a concern 
that could merit the development of an interceptor site located on the 
east coast of the United States. Will this report include a discussion 
regarding the construction of an east coast site for the deployment of 
either GBIs or Aegis Ashore?
    Dr. Roberts. DOD is continuing to work to deliver the hedge report 
to Congress as soon as possible. Given the sensitive intelligence basis 
of the hedging strategy review, and also the classified performance 
characteristics of U.S. systems, the results of the review can only be 
discussed in an appropriate setting.
    DOD is studying the benefit of placing a GBI field on the east 
coast of the United States as part of the hedge strategy. A detailed 
comparison of the operational utility of an east coast site to other 
deployment options is part of the ongoing hedge assessment, and will be 
contained in the hedge report.

    38. Senator Sessions. Dr. Roberts, what additional benefit could an 
east coast site provide?
    Dr. Roberts. DOD has studied the benefit of placing a GBI field on 
the east coast of the United States as part of the hedge strategy. A 
detailed comparison of the operational utility of an east coast site to 
other deployment options is part of the ongoing hedge assessment, and 
will be contained within the hedge report.

                    precision tracking space system
    39. Senator Sessions. General O'Reilly, this committee is painfully 
aware of the troubles associated with space system acquisition. What is 
your acquisition strategy for PTSS and why do you feel you are better 
suited than the Air Force Space Command to execute this strategy?
    General O'Reilly.
PTSS Acquisition Strategy
    The MDA is developing and acquiring PTSS in two program phases that 
combine the benefit of government-owned design and an integrated 
approach that leverages all Overhead Persistent Infrared and BMDS 
assets, with competitive forces to ensure contractor efficiencies are 
maximized:

         The development program will use a team of trusted 
        laboratories and industry participation to develop and deploy 
        two spacecraft and the required ground system. The government 
        will have unlimited and/or government purpose rights to any 
        changes to the PTSS design which will be approved by the 
        government prior to incorporation into PTSS.
         The manufacturing and production program will be 
        awarded to a competitively selected commercial entity that 
        produces multiple spacecraft using the government acquired data 
        rights.

    The overarching PTSS acquisition strategy reflects these consistent 
recommendations of multiple GAO reports and studies:

         Establish a sound executable business case.
         Research and define requirements before programs are 
        started. Limit changes after they are started.
         Shorten product development times.
         Deploy larger constellations of smaller, less complex 
        satellites that gradually increase in sophistication.
         Follow an evolutionary path toward meeting mission 
        needs rather than trying to satisfy all needs in a single step.
         Ensure competition whenever possible.

    The PTSS program is a Hybrid Program Office (HPO) with colocated 
military department representatives. In the PTSS HPO, the Air Force and 
Navy have embedded personnel to speak for their Services' equities to 
facilitate a seamless transfer from development to operations. The Air 
Force provides key input to the PTSS design on satellite operations 
architecture integration and DOT-LPF considerations (i.e., doctrine, 
organization, training, leadership and education, personnel, and 
facilities). The Navy informs the PTSS operational implementation with 
critical Aegis BMD and SM-3 missile details on assured, timely 
communications and weapon system integration.
    The development program will establish the performance baseline for 
the production program. The Johns Hopkins University Applied Physics 
Laboratory (JHU/APL), as the technical direction agent, will provide 
systems engineering continuity for the life cycle of the program.
    Ball Aerospace, Boeing, Lockheed Martin, Northrop Grumman, Orbital 
Sciences, and Raytheon companies are part of the lab team studying 
manufacturing and production readiness. They will do this in an 
environment that is non-proprietary and free of organizational 
conflicts of interest to insert producibility solutions.
    The manufacturing and production program will be a full and open 
competition. To maximize competition on the production program, MDA 
will encourage open, non-exclusive teaming between offerors on the 
manufacturing and production program. MDA will encourage similar 
teaming among subcontractors on the development program. It will be 
advantageous for proposing vendors to minimize changes to the 
government-developed system design, limiting them to lessons learned 
imperatives and component obsolescence issues.
    MDA will competitively award launch services contracts using the 
Air Force as the contracting entity to leverage existing contract 
vehicles. The first two satellites are compatible with the Evolved 
Expendable Launch Vehicle (EELV) class of launch vehicles. Future 
satellites are planned to be compatible with multiple launch vehicles, 
including EELV-class, as they become available in the commercial 
marketplace.
MDA as Lead in PTSS Acquisition
    PTSS is more than a collection of spacecraft. It is an integral 
part of the BMD fire-control system, and MDA has the requisite 
experience and expertise to integrate PTSS into the BMDS. PTSS 
development will take advantage of technical and design lessons learned 
from previous MDA satellite programs, the Space Tracking and 
Surveillance System-Demonstration (STSS-D) and the Near-Field Infrared 
Experiment. For example, STSS-D is a pathfinder for designing and 
developing PTSS's ability to close the fire control loop with Aegis.
    MDA developed PTSS requirements and system concepts over the past 3 
years using JHU/APL as the technical direction agent. Industry has been 
incorporated and involved with the material solution analysis phase, 
and flight experiments using MDA spacecraft were executed to validate 
critical design concepts. We developed the core expertise necessary to 
successfully implement the PTSS development program. With the 
established team of trusted laboratories and industry participation, 
MDA is fully prepared to develop and deploy the PTSS spacecraft and 
ground system in collaboration with the Air Force and government 
technical experts from JHU/APL and Naval Research Laboratory.

    40. Senator Sessions. Ms. Chaplain, the recently released 
Government Accountability Office (GAO) report highlights the increased 
risk of highly concurrent acquisition processes. MDA approved a new 
acquisition strategy for PTSS in January 2012 and acknowledges some 
concurrency and maintains there are benefits to this approach. How does 
the current PTSS acquisition strategy measure against GAO's knowledge-
based acquisition practices?
    Ms. Chaplain. We issued a report on MDA's BMDS in April 2012. In 
this report we note that the new acquisition strategy for PTSS is at 
risk due to concurrency in the development of its satellites. While a 
laboratory-led contractor team is still in the development phase of 
building two development satellites, MDA plans to have an industry team 
develop and produce two engineering and manufacturing development 
satellites. The PTSS program plans to then have industry compete for 
the production of the follow-on satellites. While the strategy 
incorporates several important aspects of sound acquisition practices, 
such as competition and short development timeframes, acquisition risks 
remain because the industry-built development satellites will be under 
contract and under construction before on-orbit testing of the lab-
built satellites. As such, the strategy may not give decisionmakers 
full benefit from the knowledge to be gained about the design and 
function of the lab-built satellites derived from on-orbit testing 
before making additional major commitments.

    41. Senator Sessions. Ms. Chaplain, what steps can be taken to 
strengthen the PTSS acquisition?
    Ms. Chaplain. There are two areas related to the PTSS acquisition 
that could be strengthened. The first is to ensure that DOD is pursuing 
the right acquisition, and the second is to ensure that the acquisition 
is implemented in the right way. To ensure DOD is pursuing the right 
acquisition, we believe the agency would benefit from conducting an 
analysis of alternatives (AOA) for the PTSS program. An AOA is one of 
the inputs generally required for the initiation of a new program and 
our work has found that programs with only a limited assessment of 
alternatives tended to have poorer outcomes than those that had more 
robust AOAs.\1\ MDA is developing the PTSS outside the normal DOD 
acquisition cycle and is not subject to this requirement. However, 
since MDA has not yet conducted a robust analysis to compare the 
operational effectiveness, cost, and risks of a number of alternative 
potential solutions, DOD may want to conduct an independent AOA to help 
ensure that a broad range of alternatives are considered in order to 
make fully informed programmatic and budgetary decisions going forward.
---------------------------------------------------------------------------
    \1\ GAO, Defense Acquisition: Many Analyses of Alternatives Have 
Not Provided a Robust Assessment of Weapon System Options, GAO-09-665 
(Washington, DC: Sept. 24, 2009).
---------------------------------------------------------------------------
    To ensure that the acquisition is implemented in the right way, 
decisionmakers would need a sound cost estimate as part of a business 
case and, if it were approved to proceed, MDA should ensure the design 
works as intended before committing to a large-scale constellation. As 
we reported in April 2012, although the PTSS satellite is intended to 
be a low-cost unit, the full cost of development has not yet been 
determined. DOD major defense acquisition programs are required to 
perform an Independent Cost Estimate (ICE) before advancing through 
certain major milestones.\2\ Although not required to for PTSS, the 
agency is currently working with the Office of the Director of Cost 
Assessment and Program Evaluation (CAPE) to complete an ICE expected in 
the first quarter of fiscal year 2013. Having a sound cost estimate 
would help ensure that the program is affordable and executable. We 
also reported in April that the acquisition strategy includes some 
concurrency that puts a commitment for future production before the 
program has a full understanding of program performance. Under the 
current acquisition plan, an industry team will be approved for 
production of long-lead items for two development satellites, while a 
laboratory team is still working to complete the first two development 
satellites. The program intends to conduct on-orbit checkout and 
testing of the two laboratory-produced development satellites prior to 
the decision to complete the assembly of the two industry-built 
development satellites. This strategy may not enable decisionmakers to 
fully benefit from the knowledge to be gained and the risk reduction 
opportunity afforded through on-orbit testing of lab-built satellites 
before committing to industry-built developmental satellites.
---------------------------------------------------------------------------
    \2\ 10 U.S.C. Sec. 2434 requires an ICE of the full life-cycle cost 
of the program before a major defense acquisition program can advance 
into system development and demonstration (now known as engineering and 
manufacturing development) or production and deployment. The full life-
cycle cost must be provided to the decisionmaker for consideration.

    42. Senator Sessions. Ms. Chaplain, do you have any confidence in 
the current $200 million per satellite cost estimate?
    Ms. Chaplain. In our March 2011 report, we reported that the MDA 
cost estimates we reviewed were not sufficiently credible and did not 
meet the characteristics of high-quality cost estimates based on GAO's 
Cost Estimating and Assessment Guide founded on best practices in cost 
estimating. We also made recommendations that MDA take steps to ensure 
that their cost estimates are high quality, reliable cost estimates 
that are documented to facilitate external review. In follow-on 
meetings with MDA, program officials outlined several steps that MDA 
intended to take to improve the quality of their cost estimates. 
However, in the results of our latest April 2012 review, we have yet to 
see the steps implemented.
    We cannot assess whether the $200 million cost of each PTSS 
satellite is credible or be sure of what costs are included or excluded 
until we have the opportunity to review the cost estimate. For example, 
based on information provided by program officials, MDA plans to use a 
medium EELV to launch two PTSS satellites at one time. According to Air 
Force officials, the cost of launching a medium EELV would be about 
$142 to $179 million, depending on which launch vehicle is used and 
excluding some propellants, transportation, and launch capability 
costs. Without reviewing the PTSS cost estimate, we cannot be sure 
whether launch costs are included in the estimate. In addition, as we 
noted in our 2011 report, one of the criteria for a credible cost 
estimate is having an independent cost assessment. DOD's CAPE group is 
expected to complete its ICE for PTSS in the first quarter of fiscal 
year 2013, which will help provide an important independent view of 
PTSS costs.

                             sequestration
    43. Senator Sessions. General O'Reilly, General Formica, Mr. 
Gilmore, Dr. Roberts, and Ms. Chaplain, the Budget Control Act (BCA) 
requires DOD in January 2013 to reduce all major accounts over 10 years 
by a total of $492 billion through sequestration. This will result in 
an immediate $55 billion reduction to the fiscal year 2013 defense 
program. The Secretary of Defense has been quoted on numerous occasions 
that the impact of these cuts would be ``devastating'' and 
``catastrophic'', leading to a hollow force and inflicting serious 
damage to our national defense. Yet, the Military Services must begin 
this month with some type of guidance on developing a service budget 
for fiscal year 2014. What are some of the specific anticipated 
implications of sequestration to missile defense programs?
    General O'Reilly. DOD has not formed contingency plans or risk 
assessments in the event of a sequester. If budget sequestration 
reduced DOD's budget and, in turn, the MDA budget, MDA would propose 
options for budget reduction for presentation at the MDEB for approval 
by the Defense Management Advisory Group (DMAG). Resultant schedule 
delays and additional costs for termination of work would need to be 
assessed part of this process as well.
    General Formica. The U.S. Army Space and Missile Defense Command/
Army Forces Strategic Command has not received direction from the Army 
to plan or budget for sequestration. As such, we have not assessed the 
potential implications or altered our fiscal year 2014 budget plan. 
However, if sequestration does occur, I expect that the implementation 
would negatively impact our missile defense operations and 
capabilities.
    Mr. Gilmore. If sequestration occurs, automatic percentage cuts are 
required to be applied without regard to strategy, importance, or 
priority.
    Dr. Roberts. As Secretary Panetta made clear in his letter to 
Senators McCain and Graham in November 2011, if maximum sequestration 
is triggered, DOD would face huge cuts in its budgets. The impacts of 
these cuts would be devastating for DOD, and missile defense would not 
be exempt from these large and indiscriminate cuts.
    If budget sequestration reduces DOD's budget, we would propose 
options for budget reduction for discussion at the MDEB for approval by 
the DMAG. Resultant schedule delays and additional costs for 
termination of work would need to be assessed as part of this process.
    Ms. Chaplain. We have not done work to project the impact of 
possible sequestration on DOD's projects and activities. Importantly, 
the execution and impact of any spending reductions will depend on the 
legal interpretations and actions taken by the Office of Management and 
Budget (OMB). As such, we are not in a position to provide you with an 
informed response. Generally, in terms of risks of cuts to the DOD 
missile defense budget, most of the missile defense capabilities DOD is 
pursuing are critical to strategic and regional defense plans.
    We have in the past criticized across-the-board cuts--primarily 
across-the-board rescissions. This approach can result in protecting 
ineffective programs while cutting muscle from high-priority and high-
performing programs. Across-the-board cuts are not substitutes for 
making tough and informed choices about the foundation of government.

    44. Senator Sessions. General O'Reilly, General Formica, Mr. 
Gilmore, Dr. Roberts, and Ms. Chaplain, what programs would have the 
most significant impact to operations or readiness?
    General O'Reilly. DOD has not formed contingency plans in the event 
of a sequester. If budget sequestration reduced DOD's budget and, in 
turn, the MDA budget, MDA would propose options for budget reduction 
for presentation at the MDEB for approval by the DMAG.
    General Formica. Within the U.S. Army Space and Missile Defense 
Command/Army Forces Strategic Command, an assessment has yet to be 
conducted. However, I would expect our operational capabilities to be 
degraded.
    Mr. Gilmore. In the most recently signed IMTP, Version 12.1, 
General O'Reilly and I worked hard to maintain the content of the BMDS 
test program in spite of fact-of-life budget pressures. Although we had 
to stretch out the THAAD test program to 18-month test centers, for the 
most part we maintained the schedules and test frequencies for the GMD 
and Aegis BMD programs. Sequestration required by the BCA will likely 
impact GMD and Aegis schedules and content.
    Dr. Roberts. If budget sequestration reduces DOD's budget, we would 
propose options for budget reduction for discussion at the MDEB for 
approval by the DMAG.
    Ms. Chaplain. See response to question #43.

    45. Senator Sessions. General O'Reilly, General Formica, Mr. 
Gilmore, Dr. Roberts, and Ms. Chaplain, would sequestration lead to a 
contract cancellation, termination, cost increase, or schedule delay?
    General O'Reilly. DOD has not formed contingency plans in the event 
of a sequester. If budget sequestration reduced DOD's budget and, in 
turn, the MDA budget, MDA would propose options for budget reduction 
for presentation at the MDEB for approval by the DMAG.
    General Formica. Within the U.S. Army Space and Missile Defense 
Command/Army Forces Strategic Command, we have not been directed by the 
Army to assess sequestration-caused contract cancellations, 
terminations, cost impacts, or possible schedule delays. But, I would 
expect an impact on our material development programs.
    Mr. Gilmore. MDA is best qualified to answer this question.
    Dr. Roberts. Yes, the large and indiscriminate cuts of 
sequestration would have a devastating effect on U.S. missile defense 
programs.
    Ms. Chaplain. See response to question #43.

    46. Senator Sessions. General O'Reilly, General Formica, Mr. 
Gilmore, Dr. Roberts, and Ms. Chaplain, is DOD currently conducting any 
planning in your area of responsibility? If so, can you describe the 
plan?
    General O'Reilly. DOD has not formed contingency plans in the event 
of a sequester. If budget sequestration reduced DOD's budget and, in 
turn, the MDA budget, MDA would propose options for budget reduction 
for presentation at the MDEB for approval by the DMAG.
    General Formica. I am not aware of any DOD sequestration planning 
that impact U.S. Army Space and Missile Defense Command/Army Forces 
Strategic Command assigned missile defense responsibilities.
    Mr. Gilmore. DOD is not currently preparing for sequestration, and 
OMB has not directed agencies, including DOD, to initiate plans for 
sequestration.
    Dr. Roberts. DOD has not formed contingency plans or risk 
assessments in the event of a sequester. If budget sequestration 
reduces DOD's budget, we would propose options for budget reduction for 
discussion at the MDEB for approval by the DMAG.
    Ms. Chaplain. See response to question #43.

    47. Senator Sessions. General O'Reilly, General Formica, Mr. 
Gilmore, Dr. Roberts, and Ms. Chaplain, how will you assess the risk of 
each cut?
    General O'Reilly. DOD has not formed contingency plans in the event 
of a sequester. If budget sequestration reduced DOD's budget and, in 
turn, the MDA budget, MDA would propose options for budget reduction 
for presentation at the MDEB for approval by the DMAG.
    General Formica. When directed to review programs under 
sequestration, we will assess risk to our ability to provide missile 
defense capabilities to the force. I do expect we would experience 
degradation in capabilities.
    Mr. Gilmore. It is important that DOT&E remain neutral with respect 
to program decisions. My role as DOT&E is to specify what is required 
for adequate testing. I will not accept or approve inadequate testing 
for budgetary reasons.
    Dr. Roberts. DOD has not formed contingency plans or risk 
assessments in the event of a sequester. If budget sequestration 
reduces DOD's budget, we would propose options for budget reduction for 
discussion at the MDEB for approval by the DMAG.
    Ms. Chaplain. See response to question #43.

    48. Senator Sessions. General O'Reilly, General Formica, Mr. 
Gilmore, Dr. Roberts, and Ms. Chaplain, has any planning commenced to 
date to assess the impact of sequestration reductions, such as 
prioritizing programs in preparation for reprogramming actions or 
terminations?
    General O'Reilly. DOD has not formed contingency plans in the event 
of a sequester. If budget sequestration reduced DOD's budget and, in 
turn, the MDA budget, MDA would propose options for budget reduction 
for presentation at the MDEB for approval by the DMAG.
    General Formica. DOD is not currently preparing for sequestration, 
and OMB has not directed agencies, including DOD, to initiate plans for 
sequestration.
    Mr. Gilmore. DOD is not currently preparing for sequestration, and 
OMB has not directed agencies, including DOD, to initiate plans for 
sequestration.
    Dr. Roberts. DOD has not formed contingency plans or risk 
assessments in the event of a sequester. If budget sequestration 
reduces DOD's budget, we would propose options for budget reduction for 
discussion at the MDEB for approval by the DMAG.
    Ms. Chaplain. See response to question #43.
                                 ______
                                 
             Questions Submitted by Senator James M. Inhofe
                   european phased adaptive approach
    49. Senator Inhofe. General O'Reilly, my concerns about President 
Obama's PAA have been compounded by recent reporting by the Defense 
Science Board and the GAO. The reports voiced concerns about our EPAA 
stating that it faces major delays, cost overruns, and critical 
technological problems. I would like to see the current and plann